In early 2008 it was revealed that BayernLB had made large losses due to investments in sub-prime mortgage securities in the United States.

[6] The heavy public criticism took its first toll in March 2008 when CEO Werner Schmidt resigned less than a week after the bank wrote down €1.9 billion as a result of the US subprime crisis.

[7] The crisis also consumed the governing CSU party and its chairman, Erwin Huber, who as Bavarian Minister of Finance was the acting chair of the bank's Administrative Council and was accused of covering up the extent of losses.

[16] In 2016, BayernLB entered into a partnership with Standard Chartered through which the latter will help finance Asian operations for German export-oriented small and medium-sized businesses.

The responsible authorities (ECB, German Bundesbank, BaFin and the European Commission) also acknowledged BayernLB's financial stability by approving the payout of the silent partner contributions.

[18] As member of a protection scheme for Germany's Landesbanken, BayernLB had to pay 120 million euros for the NordLB rescue deal struck in February 2019.

[21] A number of legal cases over BayernLB's €1.63 billion acquisition of Hypo Alpe-Adria-Bank International Group AG in 2007 have marred relations between Bavaria and its southern neighbor Austria.

[22] In 2014, former chief executive Werner Schmidt was found guilty of bribing the late Austrian politician Jörg Haider to facilitate the acquisition.

[24] In June 2023, a German advisory panel on Nazi-looted art recommended a painting by Wassily Kandinsky in the bank's collection be restituted to the descendants of the Jewish family that originally owned the artwork.