Hypo Alpe Adria, one of the Austrian banks that had to be nationalised during the financial crisis, has taken its first step towards reprivatisation by selling its domestic banking unit, HBA, to an Indian investor.
The European Commission has been putting pressure on the Austrian government to break up and reprivatise the lender by the end of this year, or make it return the roughly €2bn it has received in state aid since it was nationalised in 2009.
The government has been keen to avoid doing this too quickly for fear of having to sell at knock-down prices.
However, Hypo said on Friday that Sanjeev Kanoria, the London-based head of Anadi Financial Holdings, had agreed to pay €65.5m for the assets.
Gottwald Kranebitter, Hypo chief executive, said the move was an important step achieved in the face of very difficult market conditions across Europe.
He added that Mr Kanoria was “not only clearly the best bidder, but also has first-class experience in international business and excellent connections to leading financial institutions”.
Mr Kanoria said that alongside preserving the character of the bank his central goal was “above all ensuring the absolute safety of customer deposits”.
The transaction must still be approved by the FMA, Austria’s financial watchdog.
The guarantees that the Austrian state of Carinthia has given to HBA remain in force and are not affected by the deal.