The aid to the struggling bank has come from the German government's banking rescue agency, SoFFin, but the European Commission must still give regulatory clearance.

The help increases the total scope of government guarantees to IKB to 12 billion euros.

The Dusseldorf-based bank said in a statement that its balance-sheet loss in the year to March 31, 2009 amounted to 580 million euros. That compares with an 11 million euro loss the previous year.

The bank, which was the first German casualty of the structured-finance debacle, lends to small industry. The financial crisis in 2007 was the beginning of IKB's slide, and last year the bank was sold to Lone Star, a US private-equity fund, for a knock-down price.

As a condition for state aid, IKB was required to shrink its business, which will mean a cut of one-fifth of its payroll.

ch/dpa/ap
Editor: Kateri Jochum