SHARE
COPY LINK

FINANCIAL CRISIS

HRE bonus payments a ‘scandal,’ taxpayers’ group says

Germany’s taxpayers’ association (BdSt) on Monday attacked generous bonus payments for bankers at the nationalised Hypo Real Estate bank, calling them a “scandal.”

HRE bonus payments a 'scandal,' taxpayers' group says
Photo: DPA

The more than €140 billion in state guarantees received by the bank should have been made available to taxpayers, BdSt vice president Reiner Holznagel told Handelsblatt Online.

The bank, which narrowly avoided bankruptcy last year before being taking over by the state, has not managed to get back on its feet or afford the bonus payments, he said.

“The bank leaders and responsible political institutions should put on the emergency brakes immediately and save what’s left to be saved,” Holznagel told the paper. “In the future there can be no voluntary bonus payments – we’re talking about a state-run company here.”

The bank must understand that the old structures which led to the financial crisis are no longer valid, he said.

HRE has reportedly paid out some €25 million in bonuses to about 1,400 employees for their contribution to the bank’s overhaul over the last year.

“Some 1,400 staff – but not the executive board – received a one-off payment based on the contribution of the employee to restructuring, stabilising and re-orientating the corporation,” HRE said over the weekend.

Meanwhile the banking sector’s stabilisation fund, SoFFin, has reviewed the bonuses, finding no violations against current regulations.

But politicians across party lines have expressed outrage at the special payments because Hypo Real Estate showed losses of some €2.2 billion in 2009 and received some €40 billion in state aid just a few days ago.

HRE collapsed in late 2008 amid a global crisis owing to investment mistakes made by its German-Irish subsidiary Depfa.

The specialist in property lending and municipal financing was the only German bank to fail Europe-wide stress tests in July.

DPA/AFP/ka

Member comments

Log in here to leave a comment.
Become a Member to leave a comment.

MUNICH

Four injured as WWII bomb explodes near Munich train station

Four people were injured, one of them seriously, when a World War II bomb exploded at a building site near Munich's main train station on Wednesday, emergency services said.

Smoke rises after the WWII bomb exploded on a building site in Munich.
Smoke rises after the WWII bomb exploded on a building site in Munich. Photo: picture alliance/dpa | Privat

Construction workers had been drilling into the ground when the bomb exploded, a spokesman for the fire department said in a statement.

The blast was heard several kilometres away and scattered debris hundreds of metres, according to local media reports.

Images showed a plume of smoke rising directly next to the train tracks.

Bavaria interior minister Joachim Herrmann told Bild that the whole area was being searched.

Deutsche Bahn suspended its services on the affected lines in the afternoon.

Although trains started up again from 3pm, the rail operator said there would still be delays and cancellations to long-distance and local travel in the Munich area until evening. 

According to the fire service, the explosion happened near a bridge that must be passed by all trains travelling to or from the station.

The exact cause of the explosion is unclear, police said. So far, there are no indications of a criminal act.

WWII bombs are common in Germany

Some 75 years after the war, Germany remains littered with unexploded ordnance, often uncovered during construction work.

READ ALSO: What you need to know about WWII bomb disposals in Germany

However, most bombs are defused by experts before they explode.

Last year, seven World War II bombs were found on the future location of Tesla’s first European factory, just outside Berlin.

Sizeable bombs were also defused in Cologne and Dortmund last year.

In 2017, the discovery of a 1.4-tonne bomb in Frankfurt prompted the evacuation of 65,000 people — the largest such operation since the end of the war in Europe in 1945.

SHOW COMMENTS