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Fortis Investments remains under state control

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  • Fortis Investments remains under state control

BELGIUM - Fortis has confirmed its asset management arm will remain under state control, following a Brussels' Court of Appeal ruling freezing the sale of Fortis Bank's Belgian assets to French bank BNP Paribas.

BNP Paribas had hoped to settle the deal this month, but a ruling for a 65-day suspension on the Belgian government's emergency measures - taken in October to save Fortis from bankruptcy - has thrown the transaction into doubt.

The government's measures included buying the 51% of Fortis it did not already own for €4.7bn and then selling 75% of the company to French bank BNP Paribas.

The Belgian government decided late yesterday (15 Dec) to appeal against the verdict, and continues to view the sale of the assets to BNP Paribas as the "best guarantee for the continuity of Fortisbank Belgium," Belgian Prime Minister Yves Leterme said in a statement.

A spokeswomen for Fortis said since Fortis Investments, which ballooned in size after integrating Dutch bank ABN Amro's asset management arm earlier this year, will for now remain state-owned as it is part of Fortisbank Belgium.

"We can confirm that the acquisition of our parent company, Fortis Bank, by BNP Paribas may be delayed by up to 65 days."

She added: "Fortis Investments' strategy remains firmly on course despite these events: our operations, solvency and ambitions for 2009 are unchanged."

Fortis Bank Netherlands, which is owned by the Dutch state, is unaffected by the ruling, though admitted today it may suffer a loss of up to €1bn following the alleged fraud by Bernie Madoff.

"Even though Fortis Bank Nederland and its subsidiaries do not have a direct exposure related to Bernard Maddof Investment Securities LLC, there are parts of  the group which exposed to a certain risk by some funds to which these parts of the group has provided security covered loans."

If you have any comments you would like to add to this or any other story, contact Carolyn Bandel on +44 (0)20 7261 4622 or email carolyn.bandel@ipe.com

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