Lingering Controversy Over German President Bank Board Members Want Probe Into Wulff's Cheap Loan

The controversy about the private loan arrangements of German President Christian Wulff is continuing, but the head of state looks increasingly unlikely to be forced to resign. The pressure on him has eased over Christmas, with a top opposition politician saying a resignation would be "disastrous" for Germany.  

Christian Wulff's past links with businessmen are overshadowing his presidency.

Christian Wulff's past links with businessmen are overshadowing his presidency.

President Christian Wulff looks increasingly unlikely to be forced out of office over allegations that he misled parliament about his private loan arrangements, but the controversy which has damaged the reputation and credibility of the German head of state is rumbling on.

The leader of the center-left, opposition Social Democratic Party (SPD), Sigmar Gabriel, took some of the pressure off Wulff over Christmas by saying the president should remain in his job. "It would be disastrous and close to a real state crisis if a second German president were to resign in two years," Gabriel told the newspaper Die Welt in an interview published on Tuesday.

"Rigorous investigation should not lead to a resignation but to a return to an appropriate and credible fulfilment of official duties."

Wulff's predecessor, Horst Köhler, resigned in May 2010 following fierce public criticism of remarks he had made about German military missions abroad.

In his first personal statement about the affair, Wulff apologized last Thursday for not having told the Lower Saxony parliament in February 2010, when he was still governor of Lower Saxony, that he that he had a received a €500,000 ($654,000) loan from the wife of a businessman friend of his.

He had been asked by opposition lawmakers in the regional parliament to make a statement about whether he had business links with Egon Geerkens. He said he hadn't, and did not reveal that Edith Geerkens had granted him a loan to buy a house.

News of the loan from Edith Geerkens came to light earlier this month after a report in the Bild newspaper, and Wulff has been facing uncomfortable questions about his financial affairs and his ties with prominent entrepreneurs ever since.

The politician, a leading member of Chancellor Angela Merkel's Christian Democratic Union (CDU), has been criticized in the past for spending holidays in properties owned by wealthy businessmen while he was governor of Lower Saxony.

Bank Supervisory Board Member Wants Probe

SPIEGEL reports in its current edition that a new loan Wulff arranged with publicly owned BW Bank to replace the Geerkens loan had been arranged at a preferential variable interest rate of 0.9 to 2.1 percent, around half the rate charged to normal clients.

Supervisory board members of BW Bank have responded by calling for an investigation into circumstance that led to the cheap terms. "BW Bank must clarify very quickly what criteria were applied in giving the loan," supervisory board member Michael Kienzle told Bild on Tuesday.

Another board member, Claus Schmiedel, told the Bild am Sonntag newspaper on Sunday: "Speculation that there are special terms for friendly state governors damages the bank."

That mortgage loan has since been converted again, into a fixed-rate loan with a standard market rate, effective from January 2012, Welt am Sonntag newspaper reported on Sunday.

Meanwhile, an Emnid survey conducted for Bild am Sonntag found that 50 percent of Germans believe Wulff used his public offices to help his friends. But 73 percent believe there is no need for him to resign. Bild also reported that the ratings for Wulff's Christmas Day addresss to the the nation fell this year to 7.64 million viewers from more than 9 million last year.


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