Hypo Real Estate: Request for €15bn from rescue fund
The financially stricken mortgage lender Hypo Real Estate (HRE) is the first private bank to seek the shelter of the government rescue fund, by announcing on Wednesday that it has applied for a €15bn liquidity guarantee from the Financial Market Stabilization Fund, or SoFFin. The bank will also “apply to SoFFin for additional, comprehensive support, including potential capitalization measures.” This recourse to the fund is intended to secure HRE’s short-term liquidity needs. The bank reported that the €50bn in guarantees from the government, a German financial consortium and the German Federal Bank announced on October 6, 2008 are in the final stages of negotiation and will presumably be fully available by mid-November.