The involvement of the Zurich private bank with Austrian entrepreneur and investor René Benko is turning into a disaster. Last Monday, Bank Julius Bär announced that it had granted a loan of 606 million Swiss francs to a European conglomerate. The loan consists of three tranches, each worth 200 million Swiss francs. Further investigations have revealed that these tranches mainly consist of a mix of Signa Group shares and mortgages on Signa properties in Germany. The riskiest tranche is the 200 million Swiss franc loan granted to Signa Holding, with Signa Prime shares as collateral. Signa Holding has become insolvent, and the value of the shares is expected to plummet. The second tranche of 200 million Swiss francs is for financing commercial properties of the Signa Group in Germany, although the specific properties and their level of encumbrance are unknown. René Benko’s business model of buying properties and increasing their value through rising rents has backfired, causing significant losses for the private bank. The stock market has reacted harshly to this failure, with the bank’s shares losing over 20% of their value in the past two weeks.

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Information	Details
Geography	Europe
Countries	🇦🇹 🇩🇪
Sentiment	very negative
Relevance Score	1
People	René Benko
Companies	Signa Holding, Signa Prime, Börse, Julius Bär
Currencies	None
Securities	None