The Commission has opened an in-depth investigation into state support measures in favour of the German banks IKB and Sachsen LB. As a consequence of investments in US sub-prime markets, both banks ran into financial difficulties.
During the summer of 2007, the state owned bank Kreditanstalt für Wiederaufbau (KfW) provided a risk shield of around €9 billion to IKB and a group of Landesbanken granted liquidity assistance of around €17 billion to SachsenLB. Without these and several subsequent measures the banks would not have been able to continue their business.
The Commission has to assess whether these measures constitute state aid and, if so, whether they can be found compatible with EU rules for rescuing and restructuring firms in difficulties.
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