BAWAG P.S.K. Bank für Arbeit und Wirtschaft und Österreichische Postsparkasse Aktiengesellschaft
Industry Finance and Insurance
Founded 1922
Headquarters Vienna, Austria
Key people
Byron Haynes, (CEO)
Products Commercial banking, Investment banking, Private banking, Asset management
Increase 887.9 million (2009)
Total assets Increase 42,8 bn (2Q 2010)
Total equity Increase 2.025 bn (2Q 2010)
Number of employees
4,000 (2010)
Headquarters of BAWAG-PSK

BAWAG P.S.K. Bank für Arbeit und Wirtschaft und Österreichische Postsparkasse Aktiengesellschaft (BAWAG P.S.K.) is the fourth largest bank in Austria. It was formed on October 1, 2005 by the merger of the separate P.S.K. and BAWAG banking firms.

BAWAG was founded in 1922 by former Austrian Chancellor Karl Renner to extend favourable terms of credit to ordinary people, as the 'Austrian Worker's Bank'. The bank was forced to close in 1934, but resumed its operations post World War II in 1947. In 1963, it took the name of Bank für Arbeit und Wirtschaft AG, BAWAG, or, in English, 'Bank for Labour and Business Corporation'. Until 2006, the bank's majority shareholder was the ÖGB, the Austrian Trade Union Federation. In December 2006, Cerberus Capital Management, a US company invested for instance in weaponry, acquired BAWAG P.S.K. for reported €3.2 billion.

By 2004, the bank had assets of 56.2 billion euros, and a 170 million-euro annual profit.

Refco Scandal

Old logo of BAWAG P.S.K. until 2007

In October 2005, BAWAG approved a loan of 425 million euros to Phillip R. Bennett, then CEO of the commodities broker Refco, collateralized against Bennett's own holdings in the firm. However, the reason he required the money was that he had lent an undisclosed 430 million dollars of the broker's money to himself in an attempt to cover up the company's bad debts. The very day after BAWAG made Bennett the loan, the irregularities were made public, triggering a number of regulatory investigations. Refco has since declared chapter 11 bankruptcy, making BAWAG's collateral essentially worthless. Austria's central bank and Austria's Financial Market Authority are now investigating.

In April 2006, creditors of Refco sued BAWAG for over $1.3 billion, alleging that the bank had colluded to hide Bennett's fraudulent transactions back to at least 2000, and that the bank owned far more of Refco than it had ever revealed in regulatory filings.[1]

Racial Profiling

In 2016, under the alleged goal of investigating money laundering, branches of BAWAG P.S.K. have started demanding interviews with customers. It appeared that these customers were primarily chosen based on arbitrary racial profiling. Customers who refused to discuss their accounts with the bank found their contracts with the bank being terminated. These cases are currently reported to anti-discrimination offices.


  1. "Refco's Creditors Sue Austrian Bank", Wall Street Journal, April 26, 2006, page C5

External links

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