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Former Austrian bank chief arrested

Police investigating what went wrong at Hypo bank before it was bailed out by Austrian taxpayers.

THE FORMER HEAD of Austrian bank Hypo Group Alpe Adria has been arrested by Austrian authorities investigating the bank’s activities.

Wolfgang Kulterer was the bank’s chief executive during a period of rapid expansion by the bank into the Balkans. Hypo subsequently ran into trouble and was nationalised last December.

Public pressure surrounding the bank’s bailout has pushed police into looking at what went wrong at the bank prior to nationalisation. Authorities are investigating Kulterer for breach of trust and giving false testimony to an inquiry.

Kulterer has previously admitted to covering up losses at the bank and was ordered to pay a fine.

Jorg Haider, the late right-wing governor of Carinthia, Austria, sold a large chunk of the country’s stake in the bank back in 2007. After his death in a car accident the following year, it emerged that the bank needed an urgent cash injection to stay in business.

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