German State Saves Struggling Bank’s Art Collection From Deaccession

The collection includes blue chip art.

Portigon AG headquarters in Düsseldorf. Photo: Christof Koepsel/Getty Images

The German state of North Rhine-Westphalia (NRW) has agreed to buy the 297-piece art collection of the struggling state-owned bank Portigon AG for €30 million ($33.2 million)

The rebranded successor of WestLB, which folded in 2012 during the financial crisis, had planned to deaccession its star studded collection to repay a bailout package.

The plan provoked uproar from NRW’s museum directors who described the sale of artworks to compensate for the bank’s deficit as “cynical.” News of the planned deaccession came shortly after the NRW-owned casino conglomerate, Westspiel, sold two Warhol screenprints in November 2014 for over $100 million to help finance its debt.

Now the state has stepped in to save the collection from going into private ownership. According to Die Welt, it includes works by Paul Signac, Thomas Schütte, Joseph Beuys, Gerhard Richter, Günther Uecker, and an ultra-rare Stradivari violin.

“Now the works have been saved for the state and the collection is no longer in danger of being dismantled,” North Rhine-Westphalia’s finance minster Norbert Walter-Borjans told Deutsche Welle.

Portigon CEO Peter Stemper added “All parties needed time to understand the respective interests of their counterparts,” explaining the delay in getting the deal done.

The works will be purchased for the foundation “Kunst Im Landesbesitz” which will distribute the collection across the state’s museums and institutions in the next 10 weeks.

However, the structure of the deal has led to criticism from some sections of the German media. The state acquires the collection with the help of a loan from its own NRW Bank which runs over a period of 100 years, resulting in interest payments of €260,000 ($288,150) a year.

The interest payments are set to take a significant chunk out of the state’s culture budget which is set at a modest €189 million ($199.4 million) a year. In contrast, the city of Düsseldorf sets aside €130 million ($144 million) a year, while Berlin’s culture budget totals €390 million ($432 million) a year.

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