A German court on Tuesday declared that a small bank tied to a collapsed U.K. finance company was insolvent, triggering losses for dozens of small German towns.
Greensill Bank AG was deemed insolvent by a local court, leaving the towns as creditors that will likely sustain losses. Around Germany, at least 12 towns with a combined 200 million, equivalent to about $238 million, in deposits are in the same situation. Individual depositors are covered by insurance.
Among them is Mengen, a tiny municipality in southwestern Germany. Like most towns that put money into the bank, Mengen was trying to avoid the small losses that come with negative interest rates.
Bremen-based Greensill Bank, formerly known as NordFinanz Bank AG, was acquired in 20…
Read the full article at: https://www.wsj.com/articles/greensill-owned-bank-declared-insolvent-causing-losses-for-small-german-towns-11615919420
