Germany

A German state bad bank has accelerated the wind-up of Dublin-based lender Depfa Bank, after buying back €5.6 billion of its bonds from the market so far this year, the Irish Times reported. The move by bad bank FMS Wertmanagement to mop up Depfa Bank’s liabilities in the market comes as it also shrinks the lender’s assets at pace. A spokesman for FMS-WM in Munich said the wind-down is currently being carried out “faster than planned”. However, he declined to say when the bank would ultimately be wound down.

The administrator of insolvent German online travel group Unister has hired Macquarie to find a buyer for the company operating popular sites such as flight booking platform fluege.de and package travel site ab-in-den-urlaub.de. "We see enormous demand from investors for the Unister group or parts of it," Lucas Floether told Reuters on Tuesday. Groups such as broadcaster ProSieben and private equity firm EQT have shown interest in Unister in two earlier sale attempts, the most recent of which collapsed in spring 2015 over valuation issues.

The biggest bank in Europe’s most robust economy may seem an unlikely victim of Brexit. Yet in the fortnight after Britons voted to quit the European Union Deutsche Bank’s share price tumbled by 27%—putting Germany’s biggest lender in the unexalted company of British and Italian banks, The Economist reported. On July 7th it slid to €11.36 ($12.58), a record low. The price has since clambered back towards €13. But Deutsche still trades at only a quarter of the supposed net value of its assets—far behind its peers.

When it comes to bond yields in Europe, it seems there is no such thing as too low. Germany on Wednesday became the first country in the eurozone to sell 10-year debt with a negative yield at an auction, effectively ensuring that investors lose money over the life of the bond, the International New York Times reported. It is the latest twist in the upside-down world of bonds, in which global investors are increasingly willing to pay governments for the privilege of holding their debt.

German industrial output plunged unexpectedly in May, posting its steepest monthly drop since August 2014. The latest data suggests Europe’s largest economy lost steam in the second quarter after its surprisingly strong start to the year. The weak output figures followed data on Wednesday showed that German industrial orders were flat in May, before Britain’s decision to leave the European Union, and were weaker than expected, pointing to an economic slowdown.

German banks exploited a legal loophole that allowed two parties to claim ownership of the same shares, the financial watchdog will tell lawmakers this week, in schemes that could have cost the state billions of euros in tax over many years. This double ownership allowed both parties to claim tax rebates. It has provoked public anger in Germany and is an embarrassment for the Berlin government, which has campaigned for years to root out tax evasion around the world. The loophole was closed in 2012, with the means of claiming double ownership banned.

Germany’s top court ruled Tuesday that an unlimited bond-buying program created by the European Central Bank at the height of Europe’s debt crisis complies with German law, ending a yearslong legal challenge to a program credited with easing fears of a breakup of the currency zone, The Wall Street Journal reported. The verdict is an important victory for ECB President Mario Draghi over his German critics at a time of renewed tensions between the ECB and its biggest shareholder, Germany.

The European Central Bank has come under renewed pressure in Germany, after a group of academics and business people filed a complaint at the country’s highest court over the monetary policymakers’ mass bond-buying programme, the Financial Times reported. The ECB has faced repeated criticism from the economic and political establishment in the eurozone’s largest economy over the policies it has adopted to fight the threat of falling prices.

In Europe’s battle with the International Monetary Fund over Greece, Germany has a way to win, The Wall Street Journal reported. Germany, Europe’s dominant economic power, is leaning heavily on the IMF to accept hypothetical assurances that Greece’s debt burden will be addressed in the future if needed, rather than the definite and far-reaching debt relief that the IMF wanted, according to people familiar with the talks. Berlin believes the IMF will have to accept what’s on offer, even if IMF staff are unhappy about it, these people say.

Why is conventional German thinking on macroeconomics so peculiar? And does it matter? the Financial Times reported in a commentary. The answer to the second question is that it matters a great deal. A part of the answer to the first is that Germany is a creditor. The financial crisis has given it a dominant voice in eurozone affairs. This is a matter of might, not right. Creditors’ interests are important. But they are partial, not general, interests.