Brussels, 10/04/2002 (Agence Europe) - Restructuring aid granted by the Land of Berlin to Bankgesellschaft Berlin AG is being brought into question by the Commission, which has just opened formal inquiry proceedings in order to examine legality with regard to the criteria set out in the Community guidelines for State aid in favour of rescuing and restructuring companies in difficulty. The German bank, whose capital is largely held by the Land of Berlin, is among the ten leading banks in Germany. Engaged in risky real-estate business, it has been in major difficulty since 2001, and a capital injection of EUR 2 billion was considered necessary, from summer on, to avoid action on the part of banking supervisory authorities. The Land of Berlin has taken part in the injection of capital up to around EUR 1.8 billion, and the Commission accepted the aid as a rescue measure, pending reception of a restructuring plan. Since then, the bank has again been threatened by action on the part of the supervisory authorities and the Land of Berlin granted the bank, last December, a general guarantee (covering all risks incurred) amounting to a theoretical maximum of EUR 35 billion for a duration of less than thirty years. A capital increase and the general guarantee, which together represent a maximum aid volume of around EUR 37 billion, were submitted to the Commission at the same time as a restructuring plan end January 2002. At this stage, doubts exist about the compatibility of such aid, which is very high, with the common market as, on one hand, it is not certain that restructuring announced sufficiently restores the bank's viability at long-term. On the other, it is doubtful that the measures planned in order to cut back the bank's market presence will be enough to reduce the distorting effect on competition of such a large volume of aid. Finally, the question of knowing whether such aid is confined to the minimum necessary to ensure the bank's viability remains unanswered.