New IKB owner lashes out at German politicians
The Local · 27 Aug 2008, 17:20
Published: 27 Aug 2008 17:20 GMT+02:00
Karsten von Koeller, the German head of Texas distressed debt specialist Lone Star Fund, told the daily Die Zeit in an interview to appear Thursday that German Finance Minister Peer Steinbrück had initially floated a price of €800 million ($1.18 billion).
Steinbrück is vice-president of IKB's supervisory board, but von Koeller said that price was not close to the true value of a company that specialises in loans to small- and medium-sized businesses.
The sum was floated "by political figures who had certainly not looked closely at the bank's financial situation," von Koeller said.
According to press reports, Texas-based Lone Star paid between €100 million and €150 million for IKB, which had to be bailed out several times with a combination of public and private funds.
IKB faced huge losses on investments connected with the U.S. market for sub-prime mortgages and required massive financial support, mainly from state development bank Kreditanstalt für Wiederaufbau, or KfW.
KfW had initially bought a stake in IKB in 2001 to prevent a foreign investor from acquiring part of the bank, postponing by seven years what finally took place this month.
Von Koeller said the market was now reclaiming its rights and added: "The true drama is that this cost taxpayers around €10 billion."
Germany's liberal FDP party has called for a probe to determine the full cost of the IKB debacle.