Austria will risk contagion should it allow Hypo Alpe-Adria-Bank International AG to fail or force bondholders to take losses, the central bank said, as the nationalized lender’s debt slid for a second day.
Hypo Alpe-Adria-Bank International AG, a nationalized Austrian lender, said it will drop below legal capital requirements by the end of November and has started talks to get new funds from the government.
Raiffeisen Zentralbank Oesterreich AG’s capital shortfall according to criteria by the European Banking Authority increased to 2.5 billion euros ($3.4 billion) at the end of the third quarter, Der Standard reported, citing unidentified “well informed” people.
Austrian Chancellor Werner Faymann’s office opposes Oesterreichische Volksbanken AG’s plan to create a “non-core business” unit for assets it wants to wind down or sell, Der Standard reported, citing “well informed people” it didn’t identify.
German Finance Minister Wolfgang Schaeuble said the week in May 2010 between approving the first Greek bailout and the creation of the European rescue fund is the crisis moment he recalls most vividly, according to an interview in Austria’s Der Standard.
OTP Bank Nyrt., Hungary’s largest lender, fell the most in three weeks on concern banks will bear the cost of mortgage rescue plans and as a stalemate among U.S. lawmakers on the debt limit cut appetite for riskier assets.
Klaus Regling , head of the rescue fund for debt-laden euro countries, said financial markets have regained trust in the euro as the currency bloc has reached “a turning point,” Der Standard reported, citing an interview.