Volksbank Malta sale causing Austrians ‘a lot of headaches’

Austrian newspaper Weiner Zeitung reports finance ministry sources saying that Volksbank AG, which has a Maltese presence, will require €1 billion in government subsidies additional to those it has already received from the Austrian state.

Austria owns 43% of Volksbanken since a February 2012 bailout, but CEO Stephan Koren says he could not rule out that the bank would be asking for more state aid.

According to the Weiner Zeitung, the planned sale of its subsidiary Volksbank Malta "is causing a lot of headaches".

The part-nationalised Österreichische Volksbanken-Aktiengesellschaft officially started the sales process of Volksbank Malta in September, as part of the European Commission's restructuring plan for VBAG, according to which VB Malta has to be sold by the end of 2015.

The bank hired KPMG to advise on the sale, as well as a 51% stake in its Romanian banking business - which it has entirely written down - by the end of 2015, and another 50% stake in VB Leasing International by the end of 2014.

VB Malta netted €2.2 million in 2012 on total assets of about €540 million, and has a loan book of some €110 million in retail and corporate credit.

VB Malta was incorporated in 1995 and

The bank has held a commercial-bank licence since 2002. It conducts a local banking business in Malta (retail and corporate financing for mainly local customers with a volume of approx. €112 million) and is further syndicate partner in international financings. Acquisition target of this transaction will be the local banking business only, based on a solid equity base.