EC Keeps An Eye On German Subprime Crisis

Law360, New York (August 3, 2007, 12:00 AM EDT) -- U.S.-based lenders are not the only firms hit hard by the recent subprime mortgage crisis. German bank IKB Deutsche Industriebank AG has been bailed out by three other government-owned banks after disclosing that an investment in U.S. subprime loans may result in €8.1 billion loss, the banks announced Thursday.

The three state-owned banks said Thursday that they would assume the financial obligations of Rhineland Funding Capital Corp., an IKB subsidiary that invested heavily in the subprime market. Several private banks have extended lifelines to the ailing...
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