More than one billion euros – that’s how much profit the state bad bank FMS Wertmanagement made for the taxpayer by winding up the Irish Depfa Bank. The institute once belonged to the collapsed Hypo Real Estate (HRE) and made a significant contribution to its collapse during the financial crisis. In 2014, Depfa, like other parts of HRE before it, was transferred to the state winding-up agency FMS Wertmanagement in Munich and was not sold to private investors. The sale of securities holdings and the resale of the shrunken bank to the Austrian bank Bawag last year raised more than 1.3 billion euros, said FMS CEO Christoph Müller on Tuesday – a good one billion euros more than the direct sale initially planned . “We have completely fulfilled the settlement order for Depfa,” said Müller.
For 2021, FMS reported a pre-tax profit of 44 million euros, and 73 percent of the portfolio that was taken over had now been reduced, it said. But there are still 54.1 billion euros in securities left. And the process is getting tougher and tougher. Some of the remaining papers run until 2078, and premature termination would result in high losses. “We have to be prepared to continue managing the portfolios,” said Müller. Almost 400 employees are currently working on it.
In order to reduce the effort involved, at least some of the processing could be handed over to service providers in the next few years. It is important to weigh up whether it’s worth it, said the FMS boss: “After all, the service provider also wants to make money with the transaction.” Until then, care will have to be taken to further organize and simplify the holdings, which are mainly concentrated in Italy, Great Britain and the USA. For the current year, Müller hopes at least to be in the black.