BayernLB

Through its predecessor, the Bayerische Gemeindebank (founded 1914), and its much older subsidiary, the Bayerische Landesbodenkreditanstalt (founded 1884), BayernLB can claim to have more than 100 years of history. In its current form, the bank was founded by law on June 27, 1972, through the merger of the two institutions. Its first President was CSU veteran politician Karl Theodor Jacob. Later managers and Board members would also frequently be drawn from politics.

The bank expanded internationally in the 1990s, gaining toeholds in East Asia, Eastern Europe and the United States. Through the 2007 acquisition of a 50.01% share in Hypo Alpe-Adria-Bank International for a sum of €1.625 billion, BayernLB expanded its geographic presence to Austria and the Balkans.

As a commercial bank, BayernLB Group offers private and commercial customers a universal range of services in private, industrial, investment and foreign business. This includes loans, securities trading and asset management, as well as mid-term and long-term bond issuance and securitization. The bank is refinanced through a variety of commercial debenture instruments.

As a state and municipal bank, BayernLB is responsible for comprehensive credit and financial counsel for the state of Bavaria and its municipalities and districts.

Through its subsidiaries, the bank is involved in a variety of further business areas. The Bayerische Landesbodenkreditanstalt is an organ of state housing policy. Through its full ownership of the Deutsche Kreditbank, based in Berlin, BayernLB is also involved in retail banking.

Controversy

In 2011, the bank's former chief risk officer was arrested after he received an alleged $50 million corrupt payment in connection with the bank's 2005 sale of a stake in Formula One motor racing.

In a 2012 suit filed in a New York court, BayernLB asserted that Deutsche Bank sold residential mortgage-backed securities to external clients while secretly criticizing them within the bank and ultimately profiting from their failure. By 2014, both banks agreed to settle the $810 million lawsuit out of court.

A number of legal cases over BayernLB's €1.63 billion acquisition of Hypo Alpe-Adria-Bank International Group AG in 2007 have marred relations between Bavaria and its southern neighbor Austria. In 2014, former chief executive Werner Schmidt was found guilty of bribing the late Austrian politician Jörg Haider to facilitate the acquisition. In what was the first case in Germany to put management board members on trial for overpaying for an acquisition, seven former BayernLB executives went on trial over claims they overpaid by €550 million when they purchased the majority stake of Hypo Alpe-Adria-Bank.

In June 2023, a German advisory panel on Nazi-looted art recommended a painting by Wassily Kandinsky in the bank's collection be restituted to the descendants of the Jewish family that originally owned the artwork. On July 24, 2023, BayernLB announced that it had decided to return the 1907 tempera painting, Colorful Life, to the heirs of Emanuel Lewenstein.