Austria’s Fekter Says EU Talks on Hypo Alpe State Aid Continue

Austria will continue European Union talks on Hypo Alpe-Adria Bank International AG’s restructuring plan, Finance Minister Maria Fekter said after a meeting with the bloc’s top antitrust official.

Fekter told journalists in Brussels today she had a “constructive” meeting with EU Competition Commissioner Joaquin Almunia concerning the nationalized lender.

Fekter was seeking more time to sell Hypo Alpe assets in Austria, Italy and the former Yugoslavia, as well as Kommunalkredit Austria AG, another nationalized bank, two people familiar with the ministry’s plans said yesterday.

“We had an exchange on details with which we can now continue to work,” Fekter said. “It was a very good discussion and this will now be continued by experts.”

Hypo Alpe was nationalized in 2009 and has been supported by the government with 1.76 billion euros ($2.3 billion) in capital injections and additional bond guarantees. The aid requires approval from Almunia.

Kommunalkredit, a municipal lender whose 2008 bailout has cost taxpayers more than 2 billion euros, has to be sold by June under the EU’s conditions for state aid approval. Austria had until the end of March to report on its progress with the bank’s privatization plans.

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