Insider trading probe for Hypo Real Estate
AFP · 28 Dec 2008, 09:32
Published: 28 Dec 2008 09:32 GMT+01:00
The report says that prosecutors in Munich had launched an investigation in February after large sales of shares were registered just before the private bank announced a 35 percent drop in assets.
There were also suspicious share movements during a liquidity crisis which hit the bank in the autumn. The Munich-based bank, Germany's biggest victim of the global banking crisis, and its Irish subsidiary Depfa were caught up in a liquidity crunch that worsened after the US investment bank Lehman Brothers declared bankruptcy in September.
It was saved from collapse by a rescue plan worked out by the German government and the country's central bank in October. After a German association of small shareholders filed a complaint, prosecutors in Munich opened an investigation into accusations that HRE directors provided insufficient information on the bank's situation before it required an emergency bailout.
Hypo Real Estate posted a net loss of €3.1 billion in the third quarter, and said a week ago that it expects to report new losses in its fourth quarter and annual results.
In a statement issued on December 20, HRE said it will slash the cost of its workforce by almost half in three years to €600 million and will cut another €500 million by 2013.