Hypothetical survival

Hypo Real Estate’s rescue is only a reprieve. German banks and insurance companies, along with the central bank, have advanced the stricken mortgage lender a E50bn credit line, backed by a government guarantee. But the rescue package had to be enlarged by E15bn in desperate weekend negotiations to plug a growing hole in Hypo’s finances and avert panic. The bank will probably have to be wound down. In a few days Hypo managed to destabilise Germany’s apparently solid financial system, frighten th...