Signa loans

How high are the defaults for Hypo really?

Everything in the green? For CEO Michel Haller at any rate.(Bild: Mathis Fotografie)

The bank's Managing Board has "nothing to reproach itself for", all loans for Signa were properly collateralized, explained the Chairman of the Managing Board of Hypo Vorarlberg, Michel Haller, on Tuesday in Bregenz. However, the actual amount of the defaults is still open.

Following allegations that the bank had recklessly granted loans to the Signa Group, the Hypo Managing Board went public on Tuesday - partially released from banking secrecy. CEO Michel Haller spoke of "complex issues" that had apparently been "incompletely" or "misrepresented" in recent days. He now wanted to counteract this. According to Haller, the bank had been in contact with the Signa Group since the noughties. Even back then, project loans were granted, which were also repaid in full.

In 2016, 2019 and 2021, loans were then granted for three large real estate projects - for "Kurfürstendamm 231" in Berlin, Waltherpark in Bolzano and "Mariahilf" (Lamarr) in Vienna. Haller emphasized that Hypo only appeared as a "small partner" in these deals as part of a banking consortium, with Hypo's participation only accounting for between 12.5 and 18 percent of the financing volume.

Hypo CEO Michel Haller.(Bild: Mathis Fotografie)

In response to the accusations that Hypo was not listed in the land registers and therefore had no collateral, Haller explained that only the consortium leader was listed in such transactions - but on behalf of all the banks involved.

47.3 million for private foundation
In addition to these major projects, Hypo also participated in other deals with the Signa Group, such as "Chalet N" in Lech (secured with 20.8 million euros in liens) - in this case, Hypo is also listed in the land register. Hypo is registered with liens of 4.1 and 5.2 million euros for two other projects. The loan granted to the "Familie Benko Privatstiftung" amounts to EUR 47.3 million; ten percent of the company shares were agreed as collateral. As Haller explained, the foundation's balance sheet showed a result of 102 million euros at the time of the loan decision in 2020. The proportion of borrowed capital was low. Although Haller admits that loans can also be granted that are not secured if the credit rating is "good", this was not the case here.

With regard to the 131 million euros that have been repeatedly reported as "defaulted" in recent days, the banker explained last week that "defaulted" should not be confused with "unsecured". The Austrian National Bank's statement from November 2022, according to which 61 per cent of the Hypo Vorarlberg loan extended to the Signa Group at the time was said to be unsecured, "we cannot understand", emphasized Haller. He did not know these figures.

Until the opening of bankruptcy proceedings, all obligations on the part of the Signa Group were met. Not all companies are insolvent.

Michel Haller

How high will the loss really be?
However, it is still uncertain how much money the bank will lose as a result of the various bankruptcies in the Signa bubble palace, because what the various liens, company shares etc. will actually bring in will only become apparent when they are realized. When asked on Tuesday, Haller assured that the decisions regarding the Signa loans were justified at the time - even if, from today's perspective, he would of course "rather not have granted them".

In any case, he does not fear any major financial consequences and the dividend is also secure.