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EU OK'd closing of Hypo Group Alpe Adria

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Staff writer |
HGAAThe European Commission has approved a plan to orderly wind down the Austrian bank Hypo Group Alpe Adria (HGAA). The Commission found that the plan presented by the Austrian authorities is compatible with EU state aid rules.

Together with the approval of the plan, the Commission cleared both the aid granted to HGAA and additional aid possibly required for the wind-down.

Commission Vice President in charge of competition policy Joaquiín Almunia said: "After a long time spent trying to agree on a plan to reestablish a viable business model for HGAA, the moment has come to adopt a final decision that closes this chapter once and for all, gradually restores the level playing field in the market and minimises the cost for taxpayers, who have already paid a high price."

According to the plan the operative parts of the bank will be sold while the non-viable remainder is put into an orderly wind-down process. A sales contract for the Austrian subsidiary was already signed in May and the South-Eastern European network will be sold by June 30, 2015 at the latest.

Until the sales process is complete, Austria commits to a number of restrictions for new business, in particular relating to risk control, thus ensuring that the marketability of the subsidiaries is enhanced and that competition distortions are kept to a minimum.

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