* Hesse to redesign silent participation by April 30 - FinMin
* Decision likely next week - sources (Adds detail)
FRANKFURT, April 15 (Reuters) - One of the owners of German public-sector bank Helaba is rushing to change the design of part of its capital contribution to allow the lender to pass a European bank health check.
"It is possible to make our silent participation fit for the EBA (European Banking Authority) stress test by the April 30 deadline," Thomas Schaefer, Finance Minister of the regional state of Hesse, which owns 10 percent of Helaba, said on Friday.
According to two people close to Helaba's owners, Hesse would next week change the design of its 1.9 billion euro silent participation so it counts as hard capital, thus allowing Helaba to pass the test.
The EBA has said it would let lower-quality capital -- such as Helaba's silent participations -- count in the test if the bank has already fully committed itself and publicly announced measures by late April to swap them for equity or make them very similar to it.
Silent participations are a form of non-voting capital with both debt and equity characteristics that have been criticised by international regulators who fear they may not be available to absorb losses when needed.
Helaba and fellow landesbank NordLB both rely heavily on such capital. They did not receive a state bailout in the financial crisis, which has left them with a thinner capital base than their peers WestLB, HSH Nordbank and LBBW, which did get capital injections.
NordLB's owners decided earlier this week to swap silent participation for equity and inject fresh cash so the bank would be able to pass the stress test.
Of Helaba's core capital of 5.75 billion euros, 3 billion is made up of silent participations, of which 1.9 billion are owned by the state of Hesse and 400 million euros by savings banks, which own 85 percent of Helaba.
Hesse plans to change the design of its silent participation to enable them to absorb losses in the same way equity does. Bank regulators have come up with 14 criteria silent participations need to comply with under Basel III, and it already complies with 11 of them.
The savings banks will in the medium term also change the design of their silent participation, but this will take a couple of months to organise, a person close to the municipally owned lenders said. (Reporting by Angelika Gruber, Arno Schuetze; Editing by Will Waterman)