The flotation is being priced at 27-31 euros a share - slightly less than was forecast when the sale was announced in March, but still Europe's biggest flotation this year.

According to the details of the initial public offering unveiled on Monday, the Bank Austria selloff should raise about two-thirds of the 1.7bn euros of fresh capital the bank says it wants to shore up its balance sheet.

HVB bought Bank Austria for 7.8bn euros in 2000 and took it private as a vehicle for its central and Eastern European operations, in which region it has a 28% market share.

Tough times

The pricing of the 25% stake on offer values Bank Austria at 3-3.5bn euros less than what HVB paid for it.

But that decline is still considerably better than the recent performance turned in by HVB's own shares.

The group's stock hit a 20-year low in March of 6.88 euros, on fears that the weakness of the bank's balance sheet would send it running to shareholders to ask for more money.

The fears came at a time when most of Germany's banks were revealed heavy losses, and rumours of possible state bailouts were beginning to circulate.