Domestic investors exposed to Hypo 26 July 2010 4:28PM Philip Bayley As it was, seven banks failed the test: five Spanish cajas, one Greek bank and Germany's Hypo Real Estate Bank. The latter has bonds on issue in the Australian market and is undergoing a substantial restructure.Hypo Real Estate Bank International and Depfa Deutsche Pfandbriefbank AG were merged into Hypo Real Estate Bank AG between November 2008 and the end of June 2009. HRE Bank was renamed Deutsche Pfandbriefbank AG following the merger of the three banks.Hypo Real Estate Bank International has two pfandbriefe (a form of covered or asset-backed bond) on issue in the domestic market: A$200 million maturing in August 2011 and A$400 million maturing in March 2016. These bonds are rated AA by Standard & Poor's but the ratings are on CreditWatch with negative implications.The bank also has a A$225 million ordinary bond on issue, maturing in February 2011. The S&P rating on this bond is now BBB.As an aside, Hypo Real Estate Group is estimated by Barclays to hold €7.9 billion of Greek debt.