HSH Nordbank
Encyclopedia
HSH Nordbank is a commercial bank in northern Europe with headquarters in Hamburg
as well as Kiel
, Germany
. It is active in corporate and private banking. HSHs main focus is on shipping, transportation, real estate and renewable energy.
The bank was created as a result of a merger between Hamburgische Landesbank and Landesbank Schleswig-Holstein on June 2, 2003. HSH has significant operations in Luxembourg, New York
, London
and Singapore
. As of 12/2009 it employed 4,188 people worldwide.
As of 12/2009 HSH had a balance sheet of EUR 174.5 bn and reported a loss of EUR 678 mn.
The shareholders are:
In the merger the City of Hamburg and the State of Schleswig-Holstein agreed to hold the majority of shares at least until End of 2013.
In September 2008 HSH announced further writedowns. As a direct consequence the CEO Hans Berger stepped down and in the following weeks HSH announced extensive restructuring. Branches in Copenhagen and Hong-Kong were reduced to representations and new business will be focussed on the core region in northern Germany.
In December 2008 HSH was granted to issue up to EUR 30bn guaranteed notes under the German SoFFin
program. One requirement that was imposed on HSH was to raise the capital ratio to at least 8%. On January 20, 2009 EUR 3bn 3 year guaranteed notes were issued. On February 24, 2009 HSH received new capital of EUR 3bn and credit guarantees of EUR 10bn by the two main shareholders, the states of Hamburg and Schleswig-Holstein. The other shareholders, JC Flowers and the savings bank association, did not participate in the capital infusion. Together with this increase of its core-capital, HSH announced further restructuring. It plans to spin off non-strategic activities and the Toxic asset
portfolio into a—yet to be created—Bad Bank
.
On April 9, 2009, president of supervisory board Wolfgang Peiner appointed Freshfields Bruckhaus Deringer
to investigate recent management decisions of the Vorstand
.
On April 17, 2009 the supervisory board of HSH Nordbank relieved Frank Roth, member of the management board of his duties and started pressing criminal charges against him. The bank claims that Frank Roth leaked stricly confidential information to outside parties.
On October 13, 2009, the Norddeutscher Rundfunk
reported on a questionable CDO deal codenamed "Omega 55" between HSH Nordbank and BNP Paribas
in late 2007, that eventually cost HSH Nordbank 500 million Euro. Parts of that deal were not disclosed to BaFIN, the German Federal Financial Supervisory Authority.
Hamburg
-History:The first historic name for the city was, according to Claudius Ptolemy's reports, Treva.But the city takes its modern name, Hamburg, from the first permanent building on the site, a castle whose construction was ordered by the Emperor Charlemagne in AD 808...
as well as Kiel
Kiel
Kiel is the capital and most populous city in the northern German state of Schleswig-Holstein, with a population of 238,049 .Kiel is approximately north of Hamburg. Due to its geographic location in the north of Germany, the southeast of the Jutland peninsula, and the southwestern shore of the...
, Germany
Germany
Germany , officially the Federal Republic of Germany , is a federal parliamentary republic in Europe. The country consists of 16 states while the capital and largest city is Berlin. Germany covers an area of 357,021 km2 and has a largely temperate seasonal climate...
. It is active in corporate and private banking. HSHs main focus is on shipping, transportation, real estate and renewable energy.
The bank was created as a result of a merger between Hamburgische Landesbank and Landesbank Schleswig-Holstein on June 2, 2003. HSH has significant operations in Luxembourg, New York
New York
New York is a state in the Northeastern region of the United States. It is the nation's third most populous state. New York is bordered by New Jersey and Pennsylvania to the south, and by Connecticut, Massachusetts and Vermont to the east...
, London
London
London is the capital city of :England and the :United Kingdom, the largest metropolitan area in the United Kingdom, and the largest urban zone in the European Union by most measures. Located on the River Thames, London has been a major settlement for two millennia, its history going back to its...
and Singapore
Singapore
Singapore , officially the Republic of Singapore, is a Southeast Asian city-state off the southern tip of the Malay Peninsula, north of the equator. An island country made up of 63 islands, it is separated from Malaysia by the Straits of Johor to its north and from Indonesia's Riau Islands by the...
. As of 12/2009 it employed 4,188 people worldwide.
As of 12/2009 HSH had a balance sheet of EUR 174.5 bn and reported a loss of EUR 678 mn.
The shareholders are:
| Owner | Share |
|---|---|
| City of Hamburg | 42.35% |
| State of Schleswig-Holstein | 40.95% |
| JC Flowers JC Flowers J.C. Flowers & Co. is a private equity investment firm, focused on investments in the financial services sector. The firm, founded in 2001, is based in New York City and run by billionaire J. Christopher Flowers, a former Goldman Sachs partner.... |
10.6% |
| Savingsbank Association Schleswig Holstein | 6.1% |
In the merger the City of Hamburg and the State of Schleswig-Holstein agreed to hold the majority of shares at least until End of 2013.
Financial crisis of 2007-2010
With the beginning of the Financial crisis of 2007-2010 HSH had to report losses on their credit investment portfolio.In September 2008 HSH announced further writedowns. As a direct consequence the CEO Hans Berger stepped down and in the following weeks HSH announced extensive restructuring. Branches in Copenhagen and Hong-Kong were reduced to representations and new business will be focussed on the core region in northern Germany.
In December 2008 HSH was granted to issue up to EUR 30bn guaranteed notes under the German SoFFin
SoFFin
The SoFFin is a program of the German government with the purpose to stabilize and restore confidence in the financial system...
program. One requirement that was imposed on HSH was to raise the capital ratio to at least 8%. On January 20, 2009 EUR 3bn 3 year guaranteed notes were issued. On February 24, 2009 HSH received new capital of EUR 3bn and credit guarantees of EUR 10bn by the two main shareholders, the states of Hamburg and Schleswig-Holstein. The other shareholders, JC Flowers and the savings bank association, did not participate in the capital infusion. Together with this increase of its core-capital, HSH announced further restructuring. It plans to spin off non-strategic activities and the Toxic asset
Toxic asset
Toxic asset is a popular term for certain financial assets whose value has fallen significantly and for which there is no longer a functioning market, so that such assets cannot be sold at a price satisfactory to the holder...
portfolio into a—yet to be created—Bad Bank
Bad bank
Bad bank is a term for a financial institution created to hold nonperforming assets owned by a state guaranteed bank. Such institutions have been created to address challenges arising during an economic credit crunch wherein private banks are allowed to take problem assets off their books...
.
On April 9, 2009, president of supervisory board Wolfgang Peiner appointed Freshfields Bruckhaus Deringer
Freshfields Bruckhaus Deringer
Freshfields Bruckhaus Deringer LLP is a global law firm headquartered in London, United Kingdom and a member of the 'Magic Circle' of leading English law firms. It is the second-largest law firm in the world measured by revenues. In 2010-11 it achieved total revenues of £1.14 billion and profits...
to investigate recent management decisions of the Vorstand
Vorstand
In German corporate governance, a Vorstand is the management board of a corporation. It is hierarchically subordinate to the Aufsichtsrat , as German corporate law imposes a two-tier board system....
.
On April 17, 2009 the supervisory board of HSH Nordbank relieved Frank Roth, member of the management board of his duties and started pressing criminal charges against him. The bank claims that Frank Roth leaked stricly confidential information to outside parties.
On October 13, 2009, the Norddeutscher Rundfunk
Norddeutscher Rundfunk
Norddeutscher Rundfunk is a public radio and television broadcaster, based in Hamburg. In addition to the city-state of Hamburg, NDR transmits for the German states of Lower Saxony, Mecklenburg-Vorpommern and Schleswig-Holstein...
reported on a questionable CDO deal codenamed "Omega 55" between HSH Nordbank and BNP Paribas
BNP Paribas
BNP Paribas S.A. is a global banking group, headquartered in Paris, with its second global headquarters in London. In October 2010 BNP Paribas was ranked by Bloomberg and Forbes as the largest bank and largest company in the world by assets with over $3.1 trillion. It was formed through the merger...
in late 2007, that eventually cost HSH Nordbank 500 million Euro. Parts of that deal were not disclosed to BaFIN, the German Federal Financial Supervisory Authority.