Economy
Friday, September 12, 2014
The managers of state HRE bad bank FMS value management gamble is enormous: you come across masses of apparently toxic papers from Greece. But apparently so exactly they do not see out there. To the delight of some hedge funds.
The State bad bank of the German property lender Hypo Real Estate has made loud “Frankfurter Allgemeine Zeitung” in spring 2012, with Greek bonds big losses. The FMS Value Management sold accordingly bonds at bargain basement prices or submitted it to costly replacement.
The managers acted well in the mistaken assumption that it related to toxic securities that have dramatically lost with the Greek debt haircut in value . In fact, however, those bonds were subject to foreign law and therefore had to be fully served by Athens.
Hedge Funds thereby made good business at the expense of the German taxpayer. They had bought the bonds offered by Germany at prices of around 30 percent – and then enjoyed the full repayment to 100 percent
The newspaper refers to internal data, according to which losses for the German taxpayer. the amount of 2.56 billion euros could have been avoided. The bonds would have actually had a value of 3.3 billion euros.
Federal Ministry of Finance and Bank bailout fund Soffin reported these numbers according to the report as too high back. But they would not even named with reference to its “confidentiality” no values.
Source: n-tv.de
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