Hypo Alpe-Adria-Bank International AG, a nationalized Austrian lender, is preparing to sell its banking units in Austria, Italy and the former Yugoslavia and expects conditions for a deal to improve in the second half.
The bank, based in Klagenfurt, Austria, considers it “very unrealistic” that it can agree a sale of its lenders in Croatia, Serbia, Slovenia, Montenegro and Bosnia and Herzegowina this year, Chief Executive Officer Gottwald Kranebitter told journalists in Vienna today.
“We want to have completed our homework in the second half of 2012,” Kranebitter said. “When we will start the sale process and when we can sell, will be determined by the market. We assume that in the second half of 2012 markets will calm down” after Europe’s big banks have met new European capital rules, he said.
Hypo Alpe is selling the banking units as the European Commission continues to investigate whether its 2009 bailout was illegal state aid. Austria took over the bank to avert its collapse after former owners, including Bayerische Landesbank (BLGZ), withdrew their support. The bank has had three annual losses in as many years since 2008, totaling 3.2 billion euros ($4.2 billion). Almost a third of its loan book is overdue or in default.
Hypo Alpe came “close to break-even” in 2011, Kranebitter said. That comes after it reported its first half-year profit in four years because bad debt charges declined 80 percent in the six months to June 30, 2011. Net income in period was 71.6 million euros, compared with a loss of 498.9 million euros a year earlier.
Hypo Alpe received 1.35 billion euros in state capital in 2009 and 2010, as well as a 200 million-euro guarantee. The government wrote off 700 million euros of that in last year’s budget. Hypo Alpe’s former shareholders BayernLB, the Austrian province of Carinthia and insurer Grazer Wechselseitige AG also injected 210 million euros of non-voting capital last year under the deal in which Hypo Alpe was nationalized.
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