WestLB expects profits but warns of job cuts

The head of beleagured Düsseldorf-based bank WestLB said he expected it to turn a profit in 2010, based on figures that suggest the bank remained operative in 2009 without the need for restructuring.

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WestLB boss Dietrich Voigtländer told the latest edition of financial magazine Wirtschaftswoche, "We at least want to be in the black." But the figures that would back up this assessment will not be released until late March.

WestLB received state guarantees worth billions of euros in order to stay afloat last year, but still intends to pay its employees bonuses for 2009. "We pay performance-based bonuses in appropriate amounts in line with the regulations of the financial control authority BaFin and the bank rescue fund Soffin," Voigtländer said.

"The payments must be orientated to lasting criteria – performance must be worth it," he emphasised. But he also warned that bank employees should also be prepared for job cuts. "We will have to continue turning the screw on our expenses, though less than in the last few years," the board chairman admitted. "We will have to continue cutting jobs."

Despite this, Voigtländer still sees WestLB as an attractive business partner. "We concentrate on our core expertise, we have no more skeletons in the closet, and unlike a few others we have the worst behind us," he said.

WestLB, owned by the north-western state of North Rhine-Westphalia, said in November it needed government assistance via the banking sector rescue package.

This announcement came as the business daily Financial Times Deutschland said WestLB had sold high risk securities to several savings banks facing "high asset devaluations."

Several savings banks filed complaints against WestLB, charging the bank with giving poor advice and trying to pass on risky investments to others.