VIENNA Austria on Tuesday held out an olive branch to Bavaria, offering to settle a web of cross-border litigation over Austrian “bad bank” Heta, formerly Hypo Alpe Adria, by paying its neighbor at least 1.23 billion euros ($1.36 billion).

Below are milestones in the history of Hypo:

RISE

With debt guaranteed by its majority owner and Austrian home province Carinthia, Hypo from the 1990s onwards gorges on cheap money and expands aggressively in the Balkans. Carinthia, whose budget is around 2.2 billion euros, issues guarantees for Hypo which at their peak amount to 25 billion euros. The last are due to run out in 2017.

BAYERNLB ENTERS STAGE

In 2007, Bavaria’s BayernLB [BAYLB.UL] buys 50 percent plus one share in Hypo for 1.6 billion euros. BayernLB later increases its stake, hoping to benefit from Hypo’s access to the eastern European banking market, which is booming at the time.

EMERGENCY NATIONALIZATION

Hypo, which accepted yachts as collateral but had no idea which loans they were backing, turns into a nightmare for BayernLB. After several capital injections, the German bank hits the eject button and returns Hypo to Austria in 2009. BayernLB gets 1 euro and grants Hypo debt relief worth 825 million euros.

TAX PAYERS ENTER STAGE

Austrian tax payers cough up 5.5 billion euros for Hypo between 2008 and 2014, much of it to pay for the issue of new shares so that Hypo can meet its capital requirements. Hypo has to sell its operative business to comply with European Commission rules.

SALE OF AUSTRIAN BUSINESS

In May 2013, Hypo announces the sale of its Austrian business to British-Indian investor Sanjeev Kanoria’s Anadi Bank.

HAIRCUT LAW

In August 2014, Austria passes a law to bail in Hypo’s junior debt holders. BayernLB is forced to part with 800 million euros. Other creditors face haircuts worth an additional 890 million euros. Many sue Austria over the law.

BIRTH OF A BAD BANK

In November 2014, Austria parks Hypo’s toxic assets in the “bad bank” Heta Asset Resolution.

SALE OF BALKAN NETWORK

The sale of Hypo’s Balkan network, announced in December 2014, to U.S. investor Advent and the European Bank for Reconstruction and Development for up to 200 million euros is expected to close in the coming weeks.

DEBT MORATORIUM

In March 2015, Austria’s financial watchdog FMA takes control of Heta and freezes debt repayments to the tune of 11 billion euros to stave off a looming insolvency — triggering more litigation. FMA says it will decide on the size of a haircut for Heta’s creditors, including many German insurers and banks. Carinthia still backs around 10 billion euros’ worth of Heta debt, which it cannot service alone in case it comes due.

(Reporting by Angelika Gruber, writing by Shadia Nasralla, editing by Louise Heavens)