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Business

Dresdner Bank Continues to Offload Bad Debt

Dresdner Bank, the third-biggest bank in Germany, is continuing to offload its bad debt and has agreed to sell a portfolio of €1.2 billion ($1.5 billion) of loans to US investment fund Lone Star, the German bank said on Monday. Financial details were not disclosed. But the loan portfolio comprises about 1,300 loans (40 percent of which are real estate loans) to around 300 largely corporate clients. Two thirds of the loans had not been honored and the other third were "problematic," Dresdner Bank said in a statement. The bank, a unit of insurance giant Allianz, said the sale would have only a "marginal" impact on its third-quarter earnings. Dresdner Bank has embarked on a sale of its bad loans in order to clean up its balance sheet. Other banks, such as close rival HypoVereinsbank, are following suit.