ANNOUNCEMENT 10 Jun 2009
In June 2009, the government of Luxembourg announced a change in private-sector financial support.
NUMBER OF INTERVENTIONS
the letter from the European Commission to Luxembourg - Brussels, 9.7.2011 C(2009) 5640 final: http://ec.europa.eu/competition/state_aid/cases/231667/231667_1100127_2_1.pdf
On 10 June 2009 Luxembourg notified the European Commission regarding their intention to provide a loan of EUR 320 million to Kaupthing Bank Luxembourg SA. Half of the loan is financed by the Belgian state by EUR 150 million.
Kaupthing Bank Luxembourg is a credit institution that operates in Luxembourg, and has two branches in Switzerland and in Belgium. It is a subsidiary to an Icelandic banking group Kaupthing Bank hf.
The difficulties of Kaupthing Bank follow the global financial crisis and the declining confidence among financial institutions followed by drying up of inter-bank liquidity.
The EC gave the following assessment:
"The Bank is an institution active in the financial sector, subject to strong international competition, and any advantage granted to it from State resources may affect trade between States and distort competition." (par. 35 of the letter from the European Commission to Luxembourg - Brussels, 9.7.2011 C(2009) 5640 final).
A state measure in the GTA database is assessed solely in terms of theextent to which its implementation affects the extent of discriminationagainst foreign commercial interests. On this metric, the state aidproposed here is discriminatory.