KfW on Tuesday nearly doubled the amount it is setting aside to cover potential losses at German lender IKB to almost €5bn ($7.41bn) as it warned of a “dramatic” worsening of conditions in the US subprime mortgage market.
Düsseldorf-based IKB nearly collapsed under the strain of losses in the credit turmoil this year and was rescued in a bail-out led by KfW with support from Germany’s public and private sector banks.
