By Frances Robinson and Ulrike Dauer
The European Commission, the executive arm of the European
Union, Wednesday approved state aid for two German state-controlled
Landesbanken--BayernLB and NordLB--on the condition both banks
undergo substantial restructuring in the coming years.
For BayernLB, the commission approved capital measures the bank
received in 2008 and 2009 on the condition it would be
fundamentally restructured and it repays 5 billion euros ($6.1
billion) of state aid over the next seven years.
For NordLB, the commission said EUR3.3 billion in restructuring
aid granted to the bank to meet its capital requirements are in
line with EU state aid rules.
"The restructuring plan [for NordLB] submitted by the German
authorities ensures that the bank is viable, that the public
authorities that granted the aid receive adequate remuneration for
it and that the bank uses the public support to strengthen its
capital in the coming years by not paying dividends to shareholders
and not making acquisitions," the commission said.
Write to Frances Robinson at frances.robinson@dowjones.com and
Ulrike Dauer at ulrike.dauer@dowjones.com
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