The European Commission has temporarily approved Danish rescue aid to facilitate the merger of Vestjysk Bank and Aarhus Lokalbank. The state aid is granted for reasons of financial stability; the measures were found to be “well-targeted, limited to the minimum necessary and foresee sufficient safeguards limiting distortions of competition.”
Following the merger, Vestjysk Bank is to be the continuing bank. The merger will improve the bank’s capital basis and liquidity through various measures. The Commission found that all the measures, with the exception of the bank raising a subordinated loan from private investors, include elements of state aid. These measures are: (1) a capital increase with participations from both the state and private investors; (2) selling Vestjysk Bank’s shares in a Danish mortgage institution to the Danish Central Bank, and; (3) individual state guarantees for new debt amounting to DKK 35.2 billion (approximately 4.7 billion euros).
The rescue measures are approved for six months, or until the Commission has adopted a final decision on a restructuring plan, if Denmark submits it within six months.
Full content: EC Press Release
Related content: Banking Regulatory Reform: “Too Big to Fail” and What Still Needs to be Done (Abel Mateus, University College London)
Want more news? Subscribe to CPI’s free daily newsletter for more headlines and updates on antitrust developments around the world.
Featured News
UK Probes Lindab’s Acquisition of HAS-Vent Amid Fears of Market Monopoly
Apr 28, 2024 by
CPI
Shein Faces EU Regulations Over User Data
Apr 28, 2024 by
CPI
Google Fights Back Against US Antitrust Lawsuit
Apr 28, 2024 by
CPI
US Homeland Security Establishes Blue-Ribbon Board with Tech CEOs to Advise on AI
Apr 28, 2024 by
CPI
FTC Accuses Amazon Executives of Using Disappearing Messaging Apps to Conceal Evidence
Apr 28, 2024 by
CPI
Antitrust Mix by CPI
Antitrust Chronicle® – Economics of Criminal Antitrust
Apr 19, 2024 by
CPI
Navigating Economic Expert Work in Criminal Antitrust Litigation
Apr 19, 2024 by
CPI
The Increased Importance of Economics in Cartel Cases
Apr 19, 2024 by
CPI
A Law and Economics Analysis of the Antitrust Treatment of Physician Collective Price Agreements
Apr 19, 2024 by
CPI
Information Exchange In Criminal Antitrust Cases: How Economic Testimony Can Tip The Scales
Apr 19, 2024 by
CPI