German exports tumbled 5.8 per cent in August compared with July – the biggest drop since the peak of the global financial crisis in January 2009. The economy now risks slipping into recession in the third quarter, and the government has already lowered its growth forecasts for 2014 and 2015, the Financial Times reported. Those developments are unsettling a Germany corporate sector that has been a robust counterweight to the gloom in much of Europe ever since it staged a rapid recovery from the 2009 crisis, thanks to booming emerging market demand for machinery, chemicals and autos.

The European Central Bank’s investigation of the eurozone’s largest lenders is raising further concerns over the future of German publicly owned Landesbank HSH Nordbank, as its bloated shipping portfolio comes under intense scrutiny, the Financial Times reported. Germany’s largest shipping lenders, including HSH Nordbank, NordLB and Commerzbank, will see their shipping assets written down by between 10-20 per cent in the ECB’s stress tests, according to bankers familiar with the investigations.

Pilots of German carrier Deutsche Lufthansa AG will go on strike again Monday and Tuesday in their continuing dispute over retirement benefits, The Wall Street Journal reported. The pilots union, Vereinigung Cockpit, said in a statement the strike will start at 11:00 GMT on Monday and would end at 21:59 GMT on Tuesday, and would affect Lufthansa’s Airbus 320 family, Boeing 737 and Embraer planes. Lufthansa said about 1,450 flights will be canceled on Monday and Tuesday because of the strikes. More than 200,000 customers will be affected by the walkout, the company added.

eeply subordinated debt issued by German Landesbanken lost as much as six points in the past week as investors factored in the possibility that debt issued by banks that fail Europe's coming stress tests will suffer painful haircuts, Reuters reported. HSH Nordbank, Munich Hypo and Nord/LB are just some of the banks investors are nervously watching as they prepare for the worst when the European Central Bank (ECB) releases the results of its bank health check later this month.

Germany and France have tapped a prominent economist from each country for policy advice to counter “the risk of a lost decade in Europe” in an attempt to bridge the growing divide between the two countries over how to revive flagging economic growth in Europe. German Economics Minister Sigmar Gabriel and French Economy and Industry Minister Emmanuel Macron recently solicited help from French economist Jean Pisani-Ferry and Henrik Enderlein, lecturers at the Berlin-based Hertie School of Governance, in separate letters seen by The Wall Street Journal.

A drop in German exports added to a string of ugly data for Europe’s biggest economy, suggesting Germany’s growth has faltered and the country might even be in a shallow recession, The Wall Street Journal reported. German exports in August fell 5.8% from the previous month, data released on Thursday showed, the biggest monthly decline since the 2009 recession. The slide in exports came after poor readings for German manufacturing orders and factory output, and added to the gloom surrounding Europe’s economic outlook.

German property company IVG Immobilien has started looking for a buyer for its office and hotel building The Squaire as it seeks to offload legacy assets after emerging from insolvency last month, its chief executive said. IVG became insolvent after being weighed down by debt and cost overruns. The Squaire, which sits perched on top of the train station at Frankfurt airport, has been one of its most problematic assets. "We are taking The Squaire to the market. We have been in talks with potential investors since September," Ralf Jung told Reuters in an interview published on Thursday.

Factories in Britain and Germany suffered a sharp slowdown in September, raising fears that economic recovery is losing momentum against a backdrop of global political turmoil and the flagging eurozone economy, The Guardian reported. In the UK growth in manufacturing activity was the slowest in 17 months as demand for British goods waned at home and abroad. In Germany, long the powerhouse of the eurozone, the sector shrank for the first time in 15 months, hit by Russian sanctions over the Ukraine crisis and general malaise across the economies of the currency bloc.

German prosecutors said Monday that they had filed criminal charges against the former chief executive and the former management board of Hypo Real Estate, accusing them of misleading investors in 2008 during what proved to be the country’s most costly bank failure, the International New York Times DealBook blog reported. Georg Funke, the former chief executive of the Munich-based lender, and seven former management board members are accused of misleading investors about risks facing the bank ahead of its collapse in September 2008.

Infineon Technologies AG and its former memory chip unit Qimonda AG on Wednesday reached a partial out- of-court settlement over an insolvency dispute, The Wall Street Journal reported. Under the agreement, German semiconductor company Infineon will pay 260 million euros ($334 million) to the bankrupt unit. Infineon said it would pay a settlement of €135 million and acquire all patents of Qimonda for an additional €125 million. The partial settlement is covered by provisions already recognized and Infineon will pay from existing liquidity, it said.