The troubled Danish financial institution Amagerbanken has finally succeeded in its application under the government’s second bank bailout to borrow DKK 1.1 billion.
The formal approval for the loan comes some eight months after Amagerbanken’s application was first made, and will see the funds made available via the Bank Package II, reports The Copenhagen Post.
The loan was issued with an 11.01 percent annual interest rate but allowed Amagerbanken a 12 percent increase of its core capital, resulting in a 17.1 percent solvency. In October, a 13.6 percent solvency stipulation was placed on the loan application by the Danish Financial Securities Association. In April, the bank’s original application consisted of a DKK 1.4 billion loan. A statement outlining the bank’s future profitability and business foundation was also made a requirement of the loan terms.
The news of the successful application comes just days after Amagerbanken reported that close to one billion kroner had been raised through sales of equity securities and new share offerings, numbering 17.2 million in total. Additionally the sale at DKK 1000 of 290,000 equity securities aided the bank in securing new capital totalling 962 million kroner, enough to satisfy the Danish state that the bank was deserving of the loan.
The bank has previously taken out a guaranteed loan under the first bank package of DKK 2 billion.