Bank Austria (BA) has decided to abstain from taking over struggling rival Hypo Group Alpe Adria (HGAA), according to a report.The Kurier newspaper writes today (Fri) that BA decided not to acquire HGAAs Austrian department. Only in March, the BA CEO Willibald Cernko said it would be “highly ignorant” to rule out an investment due to the 60,000 clients HGAAs domestic branch.The dailys report has it that BA will not hand in a takeover offer due to the strong business ties HGAA Austria has with the Carinthian government. Little profit can be made with such activities, according to the Kurier.BA is the only Austrian or foreign bank which showed interest in taking over HGAA Austria so far. BA, which is owned by Italian bank UniCredit, was unable for comment today, while a spokesman for HGAA said the bank was optimistic a local or global competitor would invest in it. The public tender expires on 17 June.HGAA is currently trying to sell most of its various leasing business participations, real estate and a string of subsidiary firms to get back in the black. The financial institute was nationalised in 2009 after it emerged that it could collapse under its rapidly increasing debt burden.HGAA supervisory board president Johannes Ditz said chances that the banks Balkan region representations make a profit this year were good.The former Peoples Party (ÖVP) Economy Minister claimed HGAA Austria was an “attractive regional bank” but suffered “immensely” in the public debate concerning the Republic of Austrias decision to rescue it from going bust.Ditz also said he could not guarantee that HGAA will be able to pay back all of the hundreds of millions of Euros it has received in participation capital from the state and the province of Carinthia. Only recently, HGAA chief Gottwald said the same speaking to magazine profil.Leaked documents have revealed that HGAA paid hundreds of millions of Euros to consultants and cooperation partners over the years. Cover-ups, fraud, embezzlement and lenient lending deals in Southeast Europe are understood to be the key factors for the banks near breakdown, while profil claimed it was late Carinthian Alliance for the Future of Austria (BZÖ) Governor Jörg Haiders “personal cash machine” for years. The magazine wrote Haider used the former provincial bank of Carinthia to finance various controversial infrastructure projects also to secure his reputation among voters.One of the most disputed deals former HGAA bosses carried out was to provide Styrian Spirit with a two-million-Euro credit in 2005 despite lacking any securities that the struggling airline could pay the money back at any stage. Styrian Spirit filed for bankruptcy a few months later.Ex-HGAA boss Wolfgang Kulterer, former HGAA Austria chief Gert Xander and Albin Ruhdorfer, a former attorney of the bank, were found not guilty of embezzlement in March in what is believed to be just the first of a set of trials yet to take place considering the malpractices at the once prospering bank. Up to 60 political decision-makers, businesspeople and bankers across Europe face charges for their involvement, according to investigators of SoKo Hypo and CSI Hypo, two teams of business crime specialists assigned by Austrian prosecutors and the federal finance ministry.