BRUSSELS, Dec. 21 (Xinhua) -- The European Commission temporarily approved two state guarantees for German bank Hypo Real Estate (HRE), an official press release said Monday.

    The EC temporarily cleared, under EU state aid rules, the two guarantees of 8 billion euros (11.5 billion U.S. dollars) and 10 billion euros (14.4 billion U.S. dollars) respectively for German bank Hypo Real Estate.

    The two guarantees, which will be granted by SoFFin (Special Fund Financial Market Stabilization), were approved as they were "an appropriate means to remedy a serious disturbance in the German economy and as such compatible with the Treaty on the Functioning of the European Union (TFEU)" said the EC.

    Competition Commissioner Neelie Kroes said that "these guarantees will help the bank to cover urgent liquidity needs," pointing out that "they will be taken into account when the commission takes a final decision on the bank's restructuring plan."

    The 8 billion euro guarantee will start on Dec. 23, 2009 and will expire on Dec. 22, 2010. The 10 billion euro guarantee will be granted in the coming months if necessary for urgent liquidity needs.

    HRE is an internationally active bank with its headquarters in Munich, Germany. It has a balance sheet of around 390 billion euros (560 billion U.S. dollars). After being severely hit by the financial crisis in October 2008, HRE group benefited from several state support measures and was taken into state ownership in 2009.

Special Report:  Global Financial Crisis