A Bad Bank’s Boom Spotlights Crisis at German Cooperative Banks

Outside the few towns where it serves small businesses and individuals as their local cooperative lender, VR-Bank Bad Salzungen Schmalkalden was never a household name in Germany.

It gained some recognition seven years ago when it bragged about hiring Stefan Effenberg, a former star player in Germany’s national soccer squad, to boost its business with sports clubs, earning it the nickname Effenberg Bank.