The reprivatisation of pbb Deutsche Pfandbriefe has begun with the official announcement of Citigroup and Deutsche Bank as advisers for the sale process.
As reported in October state-owned parent company Hypo Real Estate Holding had appointed the two companies to explore the sale of its 100% stake in pbb, while remaining open to the idea of an IPO for the lender.
The move comes at a good time for the German state-owned company, whose profits are profits up and bad debts down.
In announcing the sale, Thomas Köntgen, co-chief executive of pbb, said that the company was on track to make a €170m gross profit in 2014, up 20% on the previous year.
Pbb is comprised of two business lines, public investment finance and the more profitable pan-European real estate finance arm.
According to the company’s last published accounts, the real estate finance portfolio stood at €23.9bn in September 2014 with a gross profit across the divisions of €127m. Problem loans are down by 14% to 806 individual loans from 939 at the end of December 2013.
Germany is the largest market for the bank but it is active across Europe, with Austria, Spain and France comprising large parts of their loan portfolio.
