Yet in recent years, ailing institutions have also made use of bad banks as a method for repairing the balance sheets without governmental interference. Between 2003 and 2005, Dresdner Bank transferred billion euros in toxic loans and shares which had lost strategic relevance to a so-called Institutional Restructuring Unit (IRU). In 2008, WestLB, the Landesbank partially owned by the state of North Rhine-Westphalia, founded a consolidation vehicle named “Phoenix” in Dublin, Ireland. As an off-balance- sheet special purpose vehicle (without a banking license), Phoenix has already taken over assets with a book value of 23 billion euros. The owners have.
