11.10.3.4 S/T/W-context

A very decisive argument is the fact that only the good parts of the ailing bank are transferred to the acquiring bank. This argument mainly applies in the S/T/ W-context, when a bank is split-up into a good bank (to be transferred) and a bad bank (to be wound-down).

The Amagerbanken-case illustrates that the Commission is satisfied that the integrated entity will be viable, if only the good parts of the ailing bank are transferred to the acquiring bank.1

The same consideration can be found in the Dunfermline-decision. The Commission observed that the Dunfermline business transferred to Nationwide was a viable business: the Transfer Package consisted of good quality assets and a good funding position (loan to deposit ratio of 45%).2 In addition, since the impaired assets stayed with Rump Dunfermline, the Dunfermline business transferred to Nationwide was cleansed of its impaired assets.3

In the case of Fionia Bank, the Commission noted that only the viable, less risky parts were transferred to Nordea. The Commission underlined this by referring to the fact that Nordea had explicitly selected the parts according to their risk profile and that Nordea had purchased only the parts where there was no evidence of impairment.4