The state-owned bank breaks its silence and admits to having provided loans to a group of real estate investors now in difficulties.
There has already been speculation in the media about the involvement of state-owned banks in the debacle surrounding Austrian investor René Benko’s Signa conglomerate. Now the Aargauische Kantonalbank (AKB) declared on Tuesday that it had also been involved in a «troubled department store and real estate investor group.»
The bank went on to state that it had sought to be released from bank-client confidentiality in the interests of a «transparent and proactive» information policy, which had been granted for relevant basic data. As with the private bank Julius Baer, the name of Signa is not mentioned.
Further Banks Involved
On the other hand, the cantonal bank from the Swiss Plateau confessed that it had provided this group with mortgage-backed financing totaling around 73 million Swiss francs for properties outside its home territory, namely in the city centers of Bern and Zurich – together with another investor group that was equally involved. The properties are likely to be department stores of the Globus chain, which a Signa company had acquired together with the Thai Central Group in equal stakes.
According to AKB, the mortgages are secured by notes on rented properties in prime locations. Both the interest and amortization schedules have always been met on time. While the property in Bern was financed directly by AKB, in Zurich AKB participated in a syndicated loan comprising several banks.
Stir at Julius Baer
We can therefore expect further Signa confessions from banks in the near future. The AKB didn't want to comment on the syndicate partners when requested by finews.ch.
Last November, the private bank Julius Baer caused a considerable stir when it acknowledged provisions of 70 million Swiss francs on its exposure to a «European conglomerate.» The market is convinced that this referred to Signa companies. At 606 million Swiss francs, Baer’s exposure is also large compared to loans from other European financial institutions.
AKB will publish the figures for the 2023 annual results on February 20 – which will provide more information about the scale of the state-owned Bank’s Signa exposure.
Dividend to be Increased
Meanwhile, the institute has already held out the prospect of increasing the distributions from the past year. AKB is 100 percent owned by the canton and enjoys a full state guarantee. Accordingly, Signa's commitment has already given rise to discussion in cantonal politics.
