Press Release: State aid: Commission approves state support for BayernLB

The European Commission approved, under EC Treaty state aid rules, a capital injection and a risk shield that the Freistaat Bayern, a German region, intends to grant to BayernLB. The support aims at reinforcing the core capital basis of BayernLB and to ensure the refinancing capability of BayernLB. The Commission found the measures appropriate to stabilise the bank, in line with its Guidance Communications on state aid in the financial crisis. The aid is necessary to avoid a serious disturbance in the German economy. The measures are limited in time and scope to the minimum necessary to restore the financing, require an adequate fee level and provide safeguards to minimise distortions of competition. They are therefore compatible with Article 87.3.b. of the EC Treaty. Germany has committed itself to submitting a preliminary comprehensive restructuring plan for BayernLB within four months and the final plan within six months.