Austria takes over Bank Medici hit by Madoff case

[Joanne98]

(CNN) -- The Austrian government has taken control of a private bank with significant exposure to the alleged fraud by Bernard Madoff.

Austria's market regulator, the FMA, installed a supervisor to take control of Bank Medici on Friday, saying the move would address the danger that the bank would not be able to pay its creditors.

Bank Medici, a private bank, announced in December that it had $2.1 billion in exposure to Madoff's investment securities through hedge funds run by the bank. Bank Medici also said its status was "solid" and that it had no liquidity problems.

The bank is 75 percent owned by its founder and chairwoman, Sonja Kohn, and 25 percent owned by Austria's largest bank, Bank Austria.

Austria's FMA also announced that Bank Medici's two managing directors, Peter Scheithauer and Werner Tripolt, resigned effective Friday.

Kohn founded Bank Medici in 1994 after having founded other investment firms, according to the bank's Web site. She has served as an adviser to Austria's economic affairs minister, foreign affairs minister and the Vienna Stock Exchange, the bank says.

http://www.cnn.com/2009/CRIME/01/03/bernard.madoff.austria.bank/index.html#cnnSTCText

[EFerrari]

1. This is completely OT, but what a great name for a bank!

lol

[Joanne98]

2. It has a long history!

The Medici Bank (1397 - 1494) was the largest and most respected bank in Europe during the 15th century.<1> There are some estimates that the Medici family was for a period of time the wealthiest family in Europe. With this monetary wealth, the family acquired political power initially in Florence, and later in the wider spheres of Italy and Europe.

A notable contribution to the profession of accounting was the improvement of the general ledger system through the development of the double entry system of tracking credits and debits.<2>

Giovanni di Bicci de' Medici was the first Medici to enter banking on his own, and while he became influential in Florentine government, it was not until his son Cosimo the Elder took over that in 1434 as gran maestro that the Medici became unofficial head of state of the Florentine republic.

http://en.wikipedia.org/wiki/Medici_bank

[scholarsOrAcademics]

3. details: book April Blood, Florence and the Plot

Against the Medici,Lauro Martines. new as of 2003. Interesting details on the density of banking in Europe in those so early dark history days.

[Joanne98]

4. Thank you scholarsOrAcademics !

:hi: