FRANKFURT (AFP) — The German bank IKB, which flirted with bankruptcy after the US subprime housing crisis erupted, posted Friday a full-year loss of 32 million euros (50 million dollars), slightly more than initially estimated.
On July 3 the company had said that it expected its annual loss to come to 24 million euros owing to a favourable tax effect.
The new provisional figure is still much less than an initial evaluation of the bank's losses a few months ago which put the figure at around 200 million euros.
In the meantime, the specialist in loans to small and medium-sized enterprises has benefited from significantly lower deferred taxes than initially expected, it said on July 3.
A detailed account of the bank's results is to be released on July 21, it added Friday.
IKB's fiscal year runs from April 1 to March 31.
The bank was one of the main victims in Germany of the collapse of the US market for high risk, or subprime, mortgages.
Securities backed by the home loans had been repackaged and sold to banks worldwide, and IKB had invested heavily in such instruments, which fell sharply in value after borrowers began to default in large numbers on the loans.
IKB was underpinned with 8.5 billion euros provided by the government, the state-owned development bank KfW and a group of private banks, to prevent its collapse last year.
KfW owns 45.5 percent of IKB and wants to sell its holding but has found it hard to attract bidders even though IKB still makes profits from its business loans.
Several mooted buyers have pulled out, and financial sources said it was not sure that KfW would get the 700-800 million euros it sought from a sale.
The supervisory board also decided Friday to prolong the contract of chairman Guenther Braeunig until October 15.
It was due to expire on July 29, a year after he was named to the post.
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