VIENNA (Reuters) - Liquidating nationalised Austrian lender Hypo Alpe Adria
"A liquidation of the bank or other insolvency scenarios are in any event not part of the model calculations," Klaus Liebscher, also head of a state task force on dealing with loss-making Hypo, said in a statement.
He was referring to scenarios his panel is drawing up to address the way forward for Hypo, whose capital needs threaten to disrupt Austria's drive to cut public debt and budget deficits.
Liebscher denied media reports that the task force would present its suggestions to political leaders by mid-week.
"Our work is in the final stage. The quality - not the speed - of the proposals is decisive," he said, stressing the goal was protecting public finances as much as possible while creating a sustainable structure for further restructuring.
The government had to take over Hypo in 2009 to avoid a collapse with regional implications.
It has already provided more than 3 billion euros ($4 billion) in state aid to the bank, whose unbridled growth fuelled by public guarantees from its home province of Carinthia drove it to the brink of insolvency.
Austria's central bank last month denied a newspaper report that Hypo could need as much as 17 billion euros in fresh aid.
Austria said in September Hypo's sell-off could cost taxpayers up to 5.4 billion euros in fresh capital by 2017.
What to do with Hypo has been left hanging as the two big parties that have dominated post-war politics try to negotiate a new coalition accord after September 29 elections that chopped their combined majority and strengthened the eurosceptic right.
Hypo's capital needs and debt repayment requirements will affect the 2014 budget, which is still being negotiated.
The previous government said the Hypo disaster would not throw it off course or force it to adopt austerity measures as it tried to balance the budget by 2016.
Finance Minister Maria Fekter has resisted calls for Hypo's toxic assets to be put into a state-owned "bad bank", hoping instead to set up a privately owned vehicle for its non-core assets so its debts do not count as state debt.
Hypo has so far agreed to sell its Austrian operating unit and has halted business at its Italian subsidiary. Its prime asset, its Balkans network, must be sold by 2015.
($1 = 0.7414 euros)(Reporting by Michael Shields; Editing by Georgina Prodhan)