CORRECTED-IFC agrees to invest 100 mln euros to buy toxic assets

(Corrects headline to show that figure is euros, not dollars)

WASHINGTON Jan 21 (Reuters) - The International Financial Corporation, the lending arm of the World Bank, said on Thursday it will join U.S.-based Varde Partners to buy distressed assets from banks in eastern Europe to kick-start lending.

IFC chief Lars Thunell said in an interview with Reuters that the organization would make available up to 100 million euros and that Minneapolis-based Varde would invest up to 350 million euros for the project.

IFC and Varde would seek to "co-purchase non-performing loans from banks that need to remove such distressed assets from their balance sheets," he said.

Varde, on its website, describes itself an investment adviser specializing in alternative investments. (Reporting by Lesley Wroughton; Editing by Leslie Adler)