August 11, 2014 / 3:37 PM / in 3 years

Austria seeks sale of Kommunalkredit

(Refiled to remove extraneous text characters in headline)

VIENNA, Aug 11 (Reuters) - Austria is making a fresh attempt to sell Kommunalkredit after failing last year to reprivatise the public-sector finance specialist which it nationalised in 2008, the bank said on Monday.

Kommunalkredit said that state agency FIMBAG, which holds state stakes in banks, would ask interested parties to submit expressions of interest by Sept. 10.

The bank had already said last week that a fresh attempt to sell a reduced it was being looked at.

The European Commission last year authorised a sale of up to half the bank’s assets as of July 2013, or up to 5.8 billion euros ($7.8 billion). It now has total assets of 12.4 billion euros.

Any assets not sold could be folded into KA Finanz, the “bad bank” that is winding down assets split off from its balance sheet after the rescue.

Kommunalkredit’s sale was originally due to close by mid-2013 but the offers Vienna got last year proved unacceptably low in a tough market for selling bank assets, forcing Vienna to miss a deadline set by EU regulators in Brussels.

That meant the Commission had the right to appoint a trustee to sell the bank, but Austria asked Brussels not to take that step and in return Kommunalkredit stopped making new loans. (1 US dollar = 0.7471 euros) (Reporting by Michael Shields; Editing by Greg Mahlich)

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