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Vienna - A long-running legal tussle between Austria and Bavaria took a new twist on Friday as Vienna sued the southern German region's state bank for €3.5bn.
"This isn't a day for jokes," Austrian Foreign Minister Hans Joerg Schelling told reporters in Vienna.
"We have studied all the alternatives for months. We owe it to the taxpayers."
The case centres on bank Hypo Group Alpe Adria (HGAA), which was nationalised by Austria during the 2009 financial crisis, costing taxpayers in Austria and Bavaria billions of euros in the subsequent winding-down.
At the time HGAA was majority-owned by Bavaria's Bayerische Landesbank (BayernLB), which Austria says failed to provide a complete picture of HGAA's dire financial position.
BayernLB, which also claims it was misled when it bought into HGAA in 2007, filed a lawsuit in Vienna claiming back €2.4bn in loans made to HGAA.
Austrian finance minister Schelling said on Friday that he remained open to an out-of-court settlement, saying he was "still ready to talk".
HGAA's collapse has also led to numerous other legal cases, including former top executives of BayernLB going on trial in the state capital Munich over the disastrous 2007 purchase.
