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Report: BayernLB hit by exposure to troubled furniture group Steinhoff


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Report: BayernLB hit by exposure to troubled furniture group Steinhoff

Bayerische Landesbank took a loss from the recent disposal of an outstanding loan of troubled furniture retailer Steinhoff International Holdings NV, Süddeutsche Zeitung reported Feb. 15, citing market sources.

The German landesbank had extended a €200 million loan to Steinhoff, which is currently being investigated for alleged manipulation of its balance sheet. The company, headquartered and listed in South Africa, is also listed on the Frankfurt Stock Exchange. Since the accounting scandal was first uncovered late in 2017, Steinhoff's stock price lost almost it's entire value within a month. The share price in Frankfurt dropped from €3.42 on Dec. 1, 2017 to just 31 cents on Dec. 29, 2017.

BayernLB managed to sell €150 million worth of Steinhoff's outstanding debt and incurred a loss of some €60 million in the process, according to Süddeutsche Zeitung. The remaining €50 million of the loan is still on the bank's books, but BayernLB has a real estate collateral for that amount, according to the report.

Several other major banks have been affected by the Steinhoff scandal, as they had previously lent to the retail company. U.S. investment banks Citigroup Inc., Bank of America Corp. and JPMorgan Chase & Co., Swiss UBS Group AG, France's BNP Paribas SA as well as Germany's Commerzbank AG are all exposed, according to the report.