1. The Management of Financial Risks at German Non-financial Firms: The Case of Metallgesellschaft.
- Author
-
Frankeland, Allen B. and Palmer, David E.
- Subjects
CORPORATE turnarounds ,RISK management in business ,RECAPITALIZATION ,BANKING industry ,PETROLEUM industry ,MARKETING strategy ,AUDITORS' reports ,SUBSIDIARY corporations ,CONGLOMERATE corporations ,BUSINESS planning - Abstract
With the implementation of petroleum marketing strategy, the United States subsidiary of a German conglomerate was subjected to substantial losses triggering an emergency recapitalization of the German company in 1993-94. The authors find that the rescue was overseen by the firm's supervisory board chaired by a member of senior management of the largest German bank. This paper examines a special auditors report that detailed the near-bankruptcy of the firm. A case study was developed, finding that the German bank was not well informed with regards to the formulation and execution of client firm's risk management strategy. This working paper can be found at the US Federal Reserve Board's International Finance Discussion Papers. You can access this by going to
- Published
- 1996