Austrian Times RSS FeedsLike the Austrian Times Facebook page!Follow us on Twitter!


Events for April
M T W T F S S
31 1 2 3 4 5 6
7 8 9 10 11 12 13
14 15 16 17 18 19 20
21 22 23 24 25 26 27
28 29 30 1 2 3 4
Add your event FREE

Today



BurgKino

Pub Quiz everyTuesday at Johnny's Pub

Popular in Austria

Smell Stop

Cosmo&Nanu

Volksbank AG (ÖVAG) suffered losses of more than 1.3 billion Euros last year.

ÖVAG losses soar

Volksbank AG (ÖVAG) suffered losses of more than 1.3 billion Euros last year.

Bank officials announced yesterday (Thurs) that the Viennese finance institute sustained a loss of 1.34 billion Euros in 2011. The news means that the Republic of Austria is robbed of its chances to demand the one billion Euros of participation capital back which it poured into the struggling bank in the past years.

ÖVAG made losses of around 1.1 billion Euros in 2009 and 1.2 billion Euros the following year. The Austrian government coalition of Social Democrats (SPÖ) and People’s Party (ÖVP) decided to partially nationalise ÖVAG in February. The move will be finalised later this month.

The coalition’s decision means that the state is set to increase its stake in the ailing bank dramatically. Finance State Secretary Andreas Schieder of the SPÖ and ÖVP Finance Minister Maria Fekter agreed to raise Austria’s share to 43 per cent. At the same time, the bank’s capital will be increased through public funds to stabilise its position on the financial market.

ÖVAG is currently headed by Gerald Wenzel. The banker’s contract as CEO will not be extended, according to reports. This would mean that Wenzel – who lacked international experience on the financial sector before taking over as CEO three years ago – leaves the bank within the coming weeks. Former BAWAG PSK (BAWAG) manager Stephan Koren might become new boss of ÖVAG.

Wenzel succeeded Franz Pinkl who is blamed by business magazines for masterminding what allegedly turned out to be a poorly planned and careless expansion. ÖVAG headed eastwards as many other Austrian financial institutes several years ago. Soaring losses and plunging profits of its subsidiary banks in Eastern Europe (EE) forced ÖVAG to sell Volksbank International (VBI).

Russian bank Sberbank acquired all but one of the nine VBI sections shortly before the Austrian government decided to partially nationalise ÖVAG. Sberbank transferred 505 million Euros but refused to take over VBI Romania. Immense losses of the Bucharest-based institute, the revaluation of affiliate Investkredit and Greek government bonds and other factors led to ÖVAG’s loss of 1.34 billion Euros in 2011.

Bank Austria (BA) head Willibald Cernko recently welcomed the government’s plans to create a bank bankruptcy law. Cernko said the case of ÖVAG "is not a glorious chapter. The state should have got involved much earlier." The BA chief criticised for not being contacted by the government at any stage of the partial nationalisation of ÖVAG despite the need to fork out more in bank taxes.

Fekter made clear that the SPÖ-ÖVP government planned to partially compensate the state’s expenses caused by the troubles of ÖVAG through an increase of the bank solidarity tax. The finance minister said the plan was to rake in 625 million Euros in 2012 following last year’s bank tax income of 500 million Euros.

Austrian Times


Are you on Facebook? Like the Austrian Times on Facebook and win great prizes!



Related articles: EU

  1. Best of the bookshelf in May, part four

    » Panorama 2012-05-31

    A Harvard University professor’s book on the killing of Osama Bin Laden, a collection of funny experiences on planes and many more interesting releases are out now.

  2. Drachma reintroduction 'would mean social explosion'

    » General News 2012-05-31

    A renowned economist has warned from reintroducing the drachma in Greece.

  3. EC warns debt-ridden Austria

    » General News 2012-05-31

    Austria has been criticised for its high public debts.

more related articles tagged "EU"

Related articles: crisis

  1. Drachma reintroduction 'would mean social explosion'

    » General News 2012-05-31

    A renowned economist has warned from reintroducing the drachma in Greece.

  2. EC warns debt-ridden Austria

    » General News 2012-05-31

    Austria has been criticised for its high public debts.

  3. Property prices keep climbing

    » Business 2012-05-31

    A real estate expert has expressed concerns about property prices in Austria.

more related articles tagged "crisis"

Related articles: CEE news

  1. AUA under pressure as pilots quit

    » Business 2012-05-30

    The number of pilots and stewardesses leaving Austrian Airlines (AUA) because of the upcoming pay cuts is on the rise.

  2. Pay cuts scare off AUA pilots

    » Business 2012-05-29

    Dozens of pilots have left Austrian Airlines (AUA) in the past weeks, according to the loss-making carrier’s works committee.

  3. Austrian skiers create overnight stay record

    » Business 2012-05-29

    The number of winter season overnight stays by Austrians has reached a new record.

more related articles tagged "CEE news"


Tag cloud:
Wenzel  Ouml  international  Cernko  losses  Austria  ndash  Euros  rsquo  Minister  BAWAG  planned  nationalise  bank  Fekter  headed  Sberbank  financial  billion  government


Latest News

 

Schools Ordered To Save, But Also To Buy Expensive Scales
Austria's embattled finance ministry has been dragged into a new scandal after it emerged that at the same time as demanding schools save 57 Millionen Euros, they were also expected to find an additional 3 million to buy an approved set of weighing scales.

OAP Hunts Down THIS Hit And Run Cyclist
Does anyone recognise this cyclist? If so you can get yourself 200 euros, and do a good deed in the process.

Property price rise continues
The price of property in Vienna has now spiralled so much that every 4th apartment comes with a price tag of 500,000 or more. And every second flat costs 300,000 or more.

Free Staff For One Person Companies - But Only In NÖ
Since the beginning of the year one-man-companies, the so called "Ein-Personen-Unternehmen" in Lower Austria have been entitled to help in the form of a free assistant.

What is on at Burg Kino this week? (18 April - 24 April)



This week at the Burg Kino on the Opernring the following films are showing:





Austria Accused Of Ignoring Giant Nazi Swastika
A huge swastika that has scarred the walls of an Austrian castle for the past 80 years is still on view despite breaching strict postwar rules banning all Nazi symbols.

Jetflyers Take The Jet Ski Onto The Road
An Austrian company is making waves after they came up with the idea of taking a jet ski – and fitting it with wheels.

Nuns invite young women to get a taste of Abbey life
In a bid to revive their Austrian abbey that doubles up as a health resort, a group of nuns are inviting young women to come and stay with them to get a taste of nun life.

Austrian women earning over fifth less than men
Austrian women are earning on average 23.4 percent less than men in the country, according to Statistik Austria.

Exploring photography and art through 1960s cult film Blow-Up
Vienna's Albertina is putting on an photography exhibition featuring stills from the cult sixties photography film Blow-Up by Michelangelo Antonioni.

 


Mala Vrata

The most popular stories –
last 7 days



Don't moan alone, the Ombudsman Investigates.

Why suffer in silence. Let off steam by letting our readers share your troubles. File your complaints about anything and everything here.

Our ombudsman David Rogers will try and help solve some of the problems from lazy civil servants through to incompetent companies – and at the very least the worst transgressors will end up in our weekly special report.


Austrian Zimmers