Lone Star to sell German subprime casualty IKB: exec
US investment fund Lone Star has begun the process of selling the German bank IKB, the country's first financial crisis victim, which Lone Star bought in 2008, an executive said Wednesday in an interview.
"The bank has been cleaned up and is now attractive for a new strategic partner," Lone Star's European boss Bruno Scherrer told the business daily Handelsblatt.
"We are going to present IKB to potential investors in November. A sale in the first quarter of 2011 is possible," he added.
IKB, which specialises in business loans, was ruined by the financial crisis that erupted in mid 2007 owing to speculative investments made in the US market for high-risk or sub-prime mortgages.
Geman authorities were forced to inject 10 billion euros (14 billion euros) to save the institution, before selling it to Lone Star for just 137 million euros, which raised an uproar in the country.
Scherrer told Handelsblatt that IKB, could hope to make "substantial profits" within two to three years.
In the first quarter of its 2010/2011 fiscal year, which ended on June 30, IKB nonetheless posted another net loss, of 125.2 million euros.
© 2010 AFP