The new merged bank was incorporated on January 1, 1969, with seat in Düsseldorf on the same location as the defunct
Landesbank der Rheinprovinz. It ambitioned to challenge the domination of the German financial landscape by the "big three" commercial banks (
Deutsche Bank,
Dresdner Bank, and
Commerzbank). In narrow terms, this ambition succeeded when WestLB became Germany's third-largest lending institution in 1976. That same year, it attempted but failed to take over the ailing
Hessische Landesbank. The new heavyweight soon had to face controversy, however. In 1973 it posted more than US$150 million in foreign-exchange losses, the result of unauthorized speculative trading by employees who were subsequently fired. In December 1977, , who had become WestLB's CEO at its creation in 1969, announced intent to resign, but was instead fired by the Supervisory Board for gross neglect. In 1978 he was charged with bribery, fraud, and malfeasance regarding a US$465,000 consulting fee he received from controversial financier Josef Schmidt. Poullain had allegedly not properly disclosed to the Supervisory Board items that included the terms of his consulting engagement, a loan he had simultaneously granted to Schmidt for the same sum, and Schmidt's legal issues at the time. He later claimed that the charges were politically motivated, and in 1981 was cleared of them all. Profits again dropped by two-thirds in the fiscal year 1980, leading to calls for the departure of Poullain's successor , who eventually resigned in July 1981. He was succeeded by , the head of the Rhineland Federation of Savings Banks, who had no professional banking experience. In mid-1982, WestLB raised DM1.12 billion in new capital, mostly from the North Rhine-Westphalia state government. By the mid-1980s, WestLB expanded its international operations, including through a 1986 arrangement to sell securities on the Tokyo exchange. In May 1988, together with other major German banks, it provided large-scale loans to the
Soviet Union, and (through a Swiss subsidiary) purchased Moscow's first foreign bond issuance since the 1917 revolution. A renewed attempt to acquire Hessische Landesbank failed again in late 1988. In January 2001 after WestLB had notified banking investigators about very large sums moving between offshore vehicles and
Trans World Group accounts at WestLB, Düsseldorf prosecutors uncovered DM15 billion ($7 billion) had passed through WestLB,
Commerzbank,
Dresdner Bank, and
Deutsche Bank. On August 30, 2002, WestLB was converted into an
Aktiengesellschaft (
joint stock company), and its promotional banking operations were transferred to
NRW.BANK. On July 19, 2005, public guarantees provided by the local government, including the so-called institutional liability () and guarantor liability () were abolished. These changes implemented an agreement with the
European Commission known in Germany as the , under which WestLB and the other Landesbanks would concentrate on competitive commercial operations. Total assets of the group were €288.1 bn as of December 31, 2008 (€292.1bn as of September 30, 2006) with operations spread over eleven countries in
Europe, six countries in
The Americas, six countries in
Asia,
Australia and
South Africa, including significant investment banking operations in
New York City,
London,
Luxembourg,
Tokyo and
Hong Kong. ==Downfall==