IKB, the German bank that shot to fame over its near-collapse under the weight of subprime investments, is up for sale, its biggest shareholder said on Friday.
The bank, which lends to about one in 10 of Germany's biggest companies, was saved last August by a bail-out spearheaded by state bank and shareholder KfW.
In November, KfW and other banks stumped up cash again to plug more holes at the stricken lender, taking the rescue bill above 6 billion euros ($9 billion). As the cost of the rescue has mounted, IKB's share price has tumbled.
Now KfW, IKB's biggest shareholder with a stake of about 40 percent, is selling up. A foundation which owns a further 12 percent is also looking for a buyer. And Sal Oppenheim, a German bank which owns about 5 percent, is also happy to sell, said one source familiar with the matter.
The auction of one of Germany's most important lenders to the country's medium-sized companies and has attracted wide interest.
A source familiar with the matter said that more than 30 would-be buyers have received the sale memorandum describing IKB's business.
IKB is worth about a fifth of what it was a year ago. The Duesseldorf-based lender now has a market value of about 500 million euros. Its share was down 2 percent at 5.56 euros on Friday.
IKB became one of Germany's highest-profile casualties in the fallout from rising defaults on risky U.S. home loans after it racked up roughly 17.5 billion euros of subprime-linked investments.
Many Germans knew nothing of its involvement in the market, however, and it panicked many investors when its problems came to light at the start of August.
Bank watchdog Jochen Sanio subsequently rallied a rescue effort to head off what he said could have snowballed into the worst banking crisis in Germany in more than 75 years.