German development bank could lose 100 million euros from Wirecard insolvency

Germany’s state development bank KfW could lose 100 million euros ($112.17 million) after payments company Wirecard filed for insolvency, a spokesman said on Saturday.

KfW subsidiary Ipex Bank lent Wirecard the sum two years ago Boersen Zeitung newspaper first reported. The funds were fully drawn down but were not hedged by Ipex, the KfW spokesman confirmed on Saturday.

“Ipex threw 100 million euros into the fire,” the KfW spokesman, who declined to be named, said.

Wirecard collapsed on Thursday, owing creditors almost $4 billion in what is shaping up to be one of Germany’s biggest corporate scandals. German regulator BaFin has been criticised at home and abroad for not spotting problems sooner.

Ipex is not alone in its exposure. Fifteen Wirecard lenders have mandated FTI Consulting as financial adviser in talks with the company on whether to waive covenants on roughly 1.75 billion euros in loans to the German firms.