HSH Nordbank

HSH Nordbank AG (HSH represents Hamburgisch - Schleswig-Holstein ) is on 2 June 2003 from the merger of the Hamburg Landesbank and Landesbank Schleswig -Holstein ( LB Kiel).

She is a regional bank in northern Germany with the two headquarters in Hamburg and Kiel and has worldwide branches and representative offices. In its core region of Hamburg and Schleswig- Holstein, it is a leading bank for corporate customers. As an international specialist finance, the focus is on transportation and real estate. In the transport sector, the Bank covers the entire value chain and is a significant provider of ship finance.

  • 7.1 Consolidation Groups
  • 7.2 Goodwill values
  • 7.3 Cash - flow forecasts
  • 7.4 breach of disclosure obligations and requirements of IAS
  • About 7.5 Valuation of financial instruments
  • 7.6 Missing values ​​in the notes

Ownership structure

As of November 30, 2013

In August 2006 it was announced that the financial investor JC Flowers & Co. LLC ( USA) buys the share of WestLB in HSH Nordbank. This was the first investment by an external company with a German Landesbank. At that time, Alexander Stuhlmann CEO of HSH. In Schleswig -Holstein ruled by a grand coalition under MP Peter Harry Carstensen (Cabinet Carstensen I April 27, 2005 to October 27, 2009) and in Hamburg CDU Senate, Ole von Beust (CDU, Senate von Beust II March 17 2004 to May 7, 2008).

2007 and 2008 targeted the State of Schleswig -Holstein and other shareholders of HSH to a public offering of HSH. With the financial crisis in 2007 and the business of HSH these plans were obsolete.

Management

The Management Board of HSH Nordbank include (as of June 27, 2013 ):

  • Constantin von Oesterreich, Chairman ( CEO) since November 1, 2012 ( Member of the Board since November 1, 2009, Chief Risk Officer ( CRO), since October 1, 2011 Chief Financial Officer ( CFO) )
  • Torsten Temp ( Member since 1 May 2010, corporate and private customers)
  • Edwin Wait Weiler (member since June 1, 2012, Risk Board )
  • Stefan Ermisch (member since December 1, 2012, Chief Financial Officer )
  • Matthias Wittenburg ( member since January 1, 2013, Capital Market Board )

Investments

The investment portfolio of HSH Nordbank is made (as of 30 August 2010) of two sub-portfolios together:

Business Unit Supporting investments

  • HSH Nordbank Securities S. A. in Luxembourg
  • HSH Nordbank Private Banking S. A. ( sold as of 30 September 2011) in Luxembourg
  • HSH Corporate Finance Group in Hamburg
  • HSH Real Estate AG Group in Hamburg
  • HSH Finance & Science GmbH in Kiel
  • Swift Capital Partners GmbH in Hamburg

Strategic Investments

  • HSH Facility Management Holding AG in Kiel

In addition to this stated on the website of the bank investment portfolio (end of 2010) has further holdings with partly significant result influences.

Private equity investments

  • CAPCELLENCE Private Equity GmbH & Co. KG, Hamburg
  • HSH Private Equity GmbH, Hamburg
  • Gardeur Beteiligungs GmbH, Mönchengladbach
  • Brinkhof Holding GmbH Germany, Erfurt

Other investments

  • HSH N Funding I, George Town, Cayman Islands
  • HSH N Funding II, George Town, Cayman Islands
  • EALING INVESTMENTS LIMITED, London, United Kingdom
  • Neptune Ship Finance (Luxembourg) S.A.R.L. & CIE, SECS.
  • PREGU GmbH, Hamburg
  • Current, L.P., Dallas, USA

The investment portfolio was, however, given by the Board of the Bank flawed and incomplete.

Another contribution consists for example of the Dii GmbH for the realization of DESERTEC in the Mediterranean region and the Middle East.

Impact of the financial crisis

2005 lost HSH Nordbank, like all savings banks and Landesbanken, the privilege of state liability. In the wake of the financial crisis, HSH Nordbank had to perform adjustments, the total depreciation as of September 2008 was, according to press releases about 1.1 billion euros. She had so loads (profit and loss account plus revaluation reserve) in the amount of 2.4 billion euros on its books.

On 24 October 2008, the Schleswig-Holstein Finance Minister Rainer Wiegard confirmed (Cabinet Carstensen I, 2005-2009, a grand coalition of CDU and SPD) Norddeutscher Rundfunk that HSH Nordbank had to take the German Financial Market Stabilization Fund. On 3 November 2008, HSH Nordbank said in a press release that it had a liquidity support in the form of guarantees for the issuance of new debt in the amount of EUR 30 billion requested from the Financial Market Stabilisation Fund ( SoFFin). The SoFFin granted this liquidity guarantee. On 10 November 2008, Hans Berger joined because of the financial crisis from his office as CEO of HSH Nordbank. The new CEO was Dirk Jens Nonnenmacher; he was since 1 October 2007, Chief Financial Officer ( CFO).

On 31 December 2008, HSH had total assets of EUR 208 billion, risk-weighted assets worth EUR 112 billion and employed approximately 4,300 people. Despite the impact of the financial crisis and use of funds from the Soffin HSH Nordbank in 2008 initially wanted to pay a dividend of 70 million euros. The bank argued that otherwise institutional investors would withdraw their shares in HSH Nordbank. This project was abandoned under pressure from the EU in March; No dividend was paid.

On 24 February 2009, the state governments of Schleswig -Holstein and Hamburg have decided in a common cabinet meeting a rescue package for HSH Nordbank, which a capital injection in the amount of three billion euros ( per 1.5 billion per state ) and a second loss risk protection in the amount of ten billion euros includes a large part of the balance sheet. On 30 April 2009, Germany notified to the EU Commission on the authorization measures, which confirmed this on 29 May 2009. On 6 May 2009, the U.S. rating agency Standard & Poor 's downgraded the rating of HSH by two levels of (A) down to (BBB ) with a negative outlook.

In July 2009 it was announced that the CEO of HSH Nordbank, Dirk Jens Nonnenmacher, should be given bonus payments of 2.9 million euros, despite the financial situation of his institute.

On September 1, 2009, Germany notified the Commission of a report drawn up by the bank restructuring plan. This looked to re-establish before the long-term viability. This plan saw a reduction in the balance sheet total and primarily through outsourcing of around 40 to 60% of all assets of HSH to an internal bad bank before.

Until 1 October 2009, the HSH were approved under the Financial Markets Stabilisation Fund ( SoFFin ) under the guarantee scheme overdrafts amounting to EUR 17 billion, covering the issuance of bonds by HSH.

On 13 October 2009 reported NDR info that Nonnenmacher was informed that 500 - million - loss business, by HSH came to the brink of insolvency. In the circle of the owner his replacement was discussed;

On 15 December 2010 it was announced that Nonnenmacher was leaving HSH Nordbank at 31 March 2011. Successor was Paul Lerbinger ( to 31 October 2012).

Prosecutor's Office and the Parliamentary Committee of Inquiry

Both in the Landtag of Schleswig -Holstein and in Hamburg Parliament for the establishment of a Parliamentary Committee of Inquiry respectively (PUA ) was adopted in June 2009. There, the circumstances of the HSH - Nordbank - crisis to be resolved.

In August 2009, the public prosecutor in Hamburg stated that the Department of Economic Crime Office of Criminal Investigation ( LKA ) have set up a ten-member task force with eight LKA officers and two prosecutors. Determines will " toward infidelity and accounting fraud ". For this purpose, the Hamburg prosecutor Wilhelm Möller in February 2010 compared to the NDR: "The process is so far set against anyone. "

In early February 2010 said Nonnenmacher first time as a witness before the Parliamentary Committee of the Hamburg Parliament. He defended controversial financial transactions - in these financial transactions, for example, " stored the north bank risk real estate loans to a specially created subsidiary on the Channel Island of Jersey from. The loans have been insured by the French BNP Paribas and then connected together with loans and securitized loan portfolio of BNP to construct the Omega 55. The North Bank was able to outsource risks for a few months (so that the risks do not appear in the 2007 balance sheet and potential impact on the Hamburgerische state election on 24 February 2008 participate ), but consisted in return other one and had to write several hundred million euros ... " - These transactions had a total value of 17 billion euros, the taz, but also acknowledged error of HSH Nordbank. His institute was " not always carefully worked " and " brought Hamburg and Schleswig -Holstein in a difficult position ." However, a personal responsibility for the crisis he refused indirectly. The money house will return to profitability, according to its assessment of expected until 2011.

The "Report and recommendation of the First Parliamentary Committee of Inquiry HSH Nordbank " has been available since 15 August 2011.

Summary:

" 27 vernommene witnesses, 50,000 pages and 800,000 euros filing costs: The Kiel Committee of Inquiry into HSH Nordbank [ ... ] submitted its final report after almost two years. This call for parliamentarians no personal consequences of the crisis of the state bank, but in favor of a greater impact of state HSH shareholders on the Supervisory Board, a stronger involvement of risk managers as well as a sale of the state shares in the bank. For the billions in losses the bank that was rescued from Hamburg and Schleswig -Holstein with three billion euros before the bankruptcy, it does not give a single culprit, said SPD chairman Jürgen Weber. But no one is free from responsibility, 'says Weber at the launch of the 439- page report. Parliamentarians see the blame at the bank managers, the Supervisory Board, the rating agencies, the banking supervision as well as in the country's politics. "

Process of " Omega 55"

Since July 24, 2013, had six boards of HSH Nordbank, were in office in 2007, responsible for mismanagement ( embezzlement of bank assets in a particularly severe case ) before the Great Economic Criminal Division 8 of the Hamburg Regional Court. In the center of the process is the ( above mentioned ) ominous business of the Bank from 2007, with the name " Omega 55".

Indicted were:

Hans Berger, the CEO of HSH Nordbank was in December 2007, when the Omega -55 business has been decided. Berger resigned in November 2008.

Dirk Jens Nonnenmacher, who belonged to the Board of Directors of the Bank since October 2007. Nonnenmacher should prepare as Chief Financial Officer and taxes the planned IPO of HSH Nordbank. In November 2008 he was appointed as successor by Berger CEO.

Peter Rieck, Deputy than the (former ) Chairman of the Board, inter alia, was responsible for the areas of shipping, transportation, real estate clients and offices in the Americas and Asia.

Jochen Friedrich, the HSH Board listened for half a year in December 2007 and was responsible for the investment management and capital markets and the London branch.

Hartmut Strauss, the (then) was responsible for the risk management of the Bank and

Bernhard Visker, Chief Executive since January 2007. Visker was responsible for corporate and real estate clients, private banking and savings. This is the first state of the entire Board of Directors of a banking house in court.

The defendants were accused of "having the complex financial transaction 'Omega 55' approved as members of the Management Board of HSH Nordbank AG in December 2007, although the basis of the application file submitted to them a comprehensive assessment of opportunities and risks of the business would not have been possible. " U a. was not to achieve a generally intended purpose of the improvement Bank account regulatory capital ratios due to the structure of this transaction. Also, the loan application did not contain meaningful information about the income and cost situation of the business. The prosecutor estimated the damage caused to 158 million euros.

Two of the defendants ( Nonnenmacher and Friedrich) threw the chamber in addition aware of before misrepresentation of financial statements. In the quarterly progress report to the HSH Group of 31 March 2008 and in a press release dated June 20, 2008 a net profit of 81 million euros had been reported, whereas in reality existed a net loss of 31 million euros. The balance sheet was corrected later and then also showed a loss of 77 million euros. The allegation is that the two defendants had intentionally created the balance wrong.

False balances

The German Financial Reporting Enforcement Panel ( FREP ) has found that the audited by the audit firm KPMG consolidated financial statements of HSH Nordbank AG are flawed to the closing dates December 31, 2008 and December 31, 2009.

Consolidation groups

In the consolidated financial statements at 31 December 2008 were 270 and in the consolidated financial statements at 31 December 2009 323 subsidiaries, joint ventures and associated companies were not included. In assessing whether the non- consolidated companies are essential quantitative aspects were ( eg impact on individual financial statement items ) and qualitative aspects are not sufficiently taken into account ( in financial vehicles such as investments). The non-inclusion of subsidiaries, joint ventures and associates is against the principle of full inclusion in accordance with International Standards balance.

Business or goodwill

In addition to these errors in the bases of consolidation goodwill value of the investments were overstated. Profit before tax in 2008 and the equity as at 31 December 2008 to EUR 100 million and the equity as at 31 December 2009 to EUR 56 million overstated.

Cash flow forecasts

The cash flow projections, are not used in the consolidated financial statements at 31 December 2008 and 2009. It lacks the cash-generating units as well as the description of the key assumptions and the period.

Breach of disclosure obligations and requirements of IAS

The consolidated financial statements at 31 December 2008 are violations of individual requirements of the accounting and disclosure requirements of International Financial Reporting Standards. This applies to

  • The subordinated debt and related derivatives,
  • Leases
  • Loans and advances to customers
  • The revaluation reserve,
  • The volume of credit risk exposures,
  • The classification of financial instruments,
  • The foreign exchange result,
  • Currency interest rate swaps,
  • Financial assets,
  • Intangible assets,
  • The remaining terms of other provisions,
  • The gross carrying amount of impaired financial assets as well as
  • Preserved and transmitted collateral.

This results in summary that the net loss of EUR 140 million was under-reported.

Overvaluation of financial instruments

The consolidated financial statements at December 31, 2009, seven to the "loans and receivables" and "available for sale " securities assigned to EUR 64 million were overstated and net income reported in accordance too high.

Missing information in the notes

In the consolidated financial statements at 31 December 2009, pursuant to International accounting standards were violated disclosure requirements and disclosure obligations. This concerns information

  • Maturity structure of subordinated capital,
  • For categorizing certificates of a structured transaction,
  • About the carrying values ​​of assets transferred as collateral receivables from customers and
  • To the amount of the reclassified securities.

The improper accounting of consolidated financial statements is also continued in the following year. In the published 12 April 2011 consolidated financial statements of HSH Nordbank for fiscal year January 1 to 31 December 2010, a loss of EUR 5.3 million is reported, for example, the " gardeur Beteiligungs GmbH". However, this is according to the result of the Federal Gazette Gardeur Beteiligungs GmbH in year 1 October 2008 to 30 September 2009. Located in the relevant financial year 1 October 2009 to 30 September 2010, generated net income of Gardeur group does not flow in the HSH - consolidated financial statements.

HSH Nordbank Arena

From July 4, 2007 to June 30, 2010, HSH Nordbank was the namesake of the Hamburg football stadium HSH Nordbank Arena. HSH Nordbank was due to the financial crisis, the naming rights that were originally agreed contractually to 2013, in 2010 prematurely. The football sponsorship was no longer employable by the support given to the public and was discontinued also saving needs. From 1 July 2010, Imtech is the new title sponsor, accordingly called the Arena since the season 2010/11 " Imtech Arena ".

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