BRUSSELS (AFP) - The European Union executive ordered Germany to recover more than three billion euros (3.8 billion dollars) given in illegal aid to seven publicly owned regional banks in the 1990s.
"The European Commission has concluded its long-standing investigation into the transfer of public assets, in the early '90s, to seven German regional public banks by ordering Germany to recover 3.0 billion euros plus interest," a statement said.
"These decisions close a very long and painful dispute between private and public banks in Germany," EU Competition Commissioner Mario Monti said.
He said his ruling would create "a level playing field in the sector, which is in the interest of businesses operating in Germany, of the consumers/taxpayers, and of the banks themselves as it removes the uncertainty which had been hanging upon them for too long".
Under legislation introduced at the start of the 1990s, German banks were required to build up substantial capital to maintain new minimum levels of solvency.
WestLB and six other public banks were given the money by their regional governments (Lander), which partly or fully own the banks, through transfers of public housing and other assets.
That prompted a complaint to Brussels from the Association of German Private Banks, which also had to increase their solvency ratios without being able to draw on public funds.
WestLB, Germany's biggest public bank, was ordered by the commission to repay 979 million euros plus interest.
The other six banks targeted by the investigation, with their repayment amounts, are:
-- Landesbank Berlin: 810 million euros plus interest
-- Norddeutsche Landesbank: 472 million euros plus interest
-- Landesbank Schleswig-Holstein: 432 million euros plus interest
-- Bayerische Landesbank: 260 million euros plus interest
-- Hamburgische Landesbank: 90 million euros plus interest
-- Landesbank Hessen-Thueringen: six million euros plus interest.