GERMANY - BaFin warns banks

The head of the German financial supervisory authority BaFin, Jochen Sanio, is reported to have warned of the threat to the country’s banks posed by leveraged buyouts. Sanio mentioned that companies targeted in private equity deals run the risk of collapsing at the next economic downturn because of risky financing. Although he acknowledged that measures have been taken to avoid problems, he also pointed out that deal structures have not yet had to stand the test of tough times.