German WestLB, Dekabank preparing merger: report

0 Comments | AFP, October, 2008

FRANKFURT (AFP) — German regional bank WestLB is drawing up a timeframe for a merger with Dekabank, an institution that manages funds from German savings banks, press reports said on Wednesday.

State-owned WestLB is under pressure from the European Commission to find a new shareholder after it benefited from a multi-billion euro (dollar) rescue package that included state aid.

WestLB was one of Germany's main casualties of the collapse of the US market for high risk, or subprime, mortgages, which has thrown international financial markets into a prolonged period of turmoil.

But WestLB also suffered major losses on fraudulent trading by some staff of shares in Volkswagen, BMW and the German retailer Metro.

The German state of North-Rhine Westphalia...