Landesbank Baden-Württemberg is taking over Leipzig-based Sachsen LB, which recently ran into trouble with its investments in the subprime sector. Sachsen recently held €3 billion ($4.09 billion) in asset-backed bonds backed by residential mortgages, commercial property and credit cards. LBBW will be providing €250 million ($341.2 million) in emergency funding and expects the takeover to be complete by Jan. 1, 2008. “Regardless of its current problems, Sachsen LB has a strong market position in its home region. We intend to exploit this potential,” said Dr. Siegfried Jaschinski, chairman of the board of managing directors of LBBW. Sachsen, which employs 600 people and has total assets of approximately €68 billion at the end of last year, will become a subsidiary of LBBW at the completion of the takeover.
LBBW Taking Over Troubled Sachsen Bank