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Major Dutch/Belgian Bank Fortis to Bail Out?

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posted on Sep, 28 2008 @ 05:29 AM


BRUSSELS (AFP) — Belgian banking officials sought to hammer out a plan on Sunday aimed at maintaining confidence in the Belgian-Dutch financial group Fortis, a spokesman for Belgium's financial regulator said.

Officials were hoping to reach a solution on Fortis, whose shares have been hammered by liquidity concerns, by Sunday "afternoon or evening," said the spokesman for the Belgian Banking, Finance and Insurance Commission (CBFA).

"There always are meetings and we are always examining initiatives that we will take with the BNB (Belgium's central bank)," the spokesman said.

Belgian officials were coordinating with authorities in the Netherlands overseeing Fortis, including the Dutch Central Bank, in order to find a common solution, he said.

Belgian ministers held a cabinet meeting late Saturday with central bank and CBFA officials to discuss the global financial crisis, and "especially Fortis," said a spokesman for Prime Minister Yves Leterme.

The spokesman refused to give more details, saying, "We will make a statement as soon as there is a solution, but not before that because it's unnecessary."

In Amsterdam, Dutch Finance Minister Wouter Bos met late Saturday with top central bank officials, the ANP news agency reported, but no details were given about the subject of the meeting.

Fortis said late Friday it had replaced its chief executive, Herman Verwilst, with Filip Dierckx, head of its banking division.

After two days of steep slides in its share price, the Belgian-Dutch banking and insurance group hastily arranged a news conference to assure clients that their deposits were safe and that it had ample funding.

But shares in the group only fell further, sliding nearly 21 percent Friday -- down 71 percent since the beginning of the year.


Will Fortis be the first huge bank to collase as a result of the American sub-prime crisis? The Swiss bank UBS has been hit much harder but so far still exists, whereas Fortis faces to be taken over by Dutch banking giant ING.

Fortis was part of a consortium last year with Royal Bank of Scotland and Banko Santander which eventually won a battle with Barclays to buy the big Dutch Bank ABN-Amro.

Fortis paid 24 billion EUR for the Dutch line of business while RBS would get the US subsidiary La Salle and BS would get the Italian activities. As a consequence of EU regulation, Fortis was forced to sell parts of ABN-AMRO activities to Deutsche Bank, making a considerable loss.

[edit on 28-9-2008 by Mdv2]

posted on Oct, 4 2008 @ 11:13 AM
Fortis just got bought by the Dutch government after they first put over 20 billion in it, now we can add another 16 billion to that....


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