Landesbanken Mind the gap

What is implicit state support worth to a company’s credit rating? Even the world’s two biggest credit agencies can’t agree. Look at how they have rated the Landesbanken. Germany’s state-owned regional banks are set to lose official state guarantees over their debts in July. However, they will continue to enjoy some implicit support for their debts. That’s because the federal states and savings banks that own them won’t want them to go under. As providers of finance to local companies, the Lande...