thrills n spills thursday night , page-4

Its things like this which we will see more of...might not be subprime...not hitting the P&L though!




FRANKFURT (Dow Jones)--German state development bank KfW has made a provision of EUR2.5 billion for possible exposure to losses by German mortgage bank IKB Deutsche Industriebank AG (IKB.XE), according to a filing Wednesday with the U.S. Securities and Exchange Commission available on the SEC's Web site.
According to the filing, KfW currently estimates that the possible losses to which it is exposed in connection with the pledged risk protection for IKB "may be up to EUR2.5 billion."
"On August 14, 2007, KfW's board of managing directors decided to account for these potential losses by reallocating on its balance sheet EUR2.5 billion from its fund for general bank risks (...) to a specific reserve."
After this reallocation, KfW's fund for general bank risks will decrease to EUR2.8 billion, according to the filing.
A KfW spokesman confirmed the filing but declined to comment further.