More state aid
November 5, 2009
The new 3-billion-euro injection comes after the German government provided HRE with 3.3 billion euros in October to complete nationalization of the bank.
The government is now in full possession of Hypo Real Estate's capital, but, according to a statement made by the bank, the additional injection was needed to boost HRE's reserves (700 million euros), secure mortgage credit (1.3 billion euros), and provide hybrid capital (1.0 billion euros).
The German government rescued HRE after it was rocked by the financial crisis last September. In total, Germany pledged in excess of 100 billion euros in loan guarantees to the Munich-based bank, which have been extended by seven months until June of next year.
HRE said it was waiting for the European Commission to approve the latest capital injection. The bank said in a statement that it was expecting the approval sometime in the "next few days."
glb/AP/dpa
Editor: Trinity Hartman