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Austrian Parliament Approves Hypo Alpe Law Imposing Loss

Austria’s governing parties broke new ground in Europe by approving a law that imposes losses on holders of state-guaranteed debt owed by nationalized Hypo Alpe-Adria-Bank International AG.

The parliament in Vienna approved a law proposed by Finance Minister Michael Spindelegger last month that will break up Hypo Alpe. One part will be sold, while another will wind down 18 billion euros ($24 billion) of assets over a period of years. Opposition lawmakers blasted the law, demanding that the bank be sent into insolvency to limit costs for taxpayers.