The VR-Bank Bad Salzungen Schmalkalden made headlines three years ago when it hired ex-national player Stefan Effenberg as a specialist in football financing.
(Photo: Bongarts / Getty Images)
Frankfurt The VR-Bank Bad Salzungen Schmalkalden is one of the most unusual financial institutions in Germany. Not only did she make headlines with the engagement of ex-national player Stefan Effenberg as a specialist in football financing, but has also been fighting for months against the dismissal of her chief executive officer, which is required by the financial supervisory authority Bafin.
The institute from Thuringia has now achieved an important success. The public prosecutor’s office in Mühlhausen, which has long investigated the chief executive officer on suspicion of infidelity, wants to close its case.
This presumably means that the Bafin ‘s dismissal of the CEO is also off the table. The financial regulator did not want to comment on Monday.
At the general assembly of the cooperative bank on Saturday, it was announced that the public prosecutor’s office wants to end its investigation. A spokesman for the investigative authority confirmed this to the Handelsblatt: “We are considering discontinuing the proceedings, subject to the defendant’s approval under Section 153a of the Code of Criminal Procedure, in return for a payment of 240,000 euros.” The Mühlhausen Regional Court had already agreed.
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According to the lawyer for the supervisory board, Edgar Steinle, the CEO has also signaled that he would go along with “the path of hiring”. The manager himself and the money house did not want to comment on it.
Bafin probably dismissed from the table
The main reason for the intervention of the Bafin was a real estate transaction of the bank from 2014, in which the boss of the money house is involved himself.
The public prosecutor’s office in Mühlhausen has been investigating since 2018 on suspicion of infidelity in the real estate deal against the chief executive officer and a former employee of the money house. Essentially, it was about the question of whether the CEO had gained a personal benefit from buying the property – at the expense of the bank.
Bafin initially suspended the recall proceedings against the CEO at the end of 2020 in order to await further findings from the criminal investigation.
VR-Bank wants to take on the fine and other costs for the boss
Despite the investigation, the members and the supervisory board of the VR-Bank stood behind the board the entire time – and now want to give it a helping hand financially. The general assembly had decided to accept any fine in the event that the proceedings were discontinued, explained Steinle.
In the vote on the topic at the general assembly, there was only one vote against, said Steinle. Almost a year ago, a majority of 95 percent voted to forego possible recourse claims against the CEO.
The VR-Bank from Thuringia is actually one of the dwarfs of the German banking landscape, the balance sheet total is around 1.3 billion euros. But the cooperative bank from the Thuringian province does not shy away from unusual deals and big names.
A good three years ago, the money house hired Effenberg to boost the money house’s football business – and thus attracted nationwide attention. The employee Effenberg should help to correctly assess the risks in the football sector. One branch of the bank is loans to professional clubs.
With their business model, the Thuringians clearly set themselves apart from other Volksbanks in other areas as well. The institute acquires and sells real estate, invests in renewable energies such as wind turbines – and not just in its own region.
In the future, the VR-Bank Bad Salzungen in Hesse will be active on a larger scale. The money house merges with the much smaller Raiffeisenbank Borken Nordhessen, which is around 100 kilometers away. Such a merger, in which two geographically distant cooperative banks merge, is also considered unusual. The general assembly also approved this over the weekend.
More: The Volksbanken are tinkering with a digital ecosystem with services beyond the banking business.