Fortis receives support from Benelux governments

by Richard Kilner

Story link: Fortis receives support from Benelux governments

Fortis is to receive a multi-billion euro support package from the governments of Belgium, the Netherlands and Luxembourg, who are to give a combined total of 11.2bn to the bank.

The Belgian government is to provide Fortis Bank (Belgium) with 4bn euros, the Dutch government will grant 4.7bn to Fortis Bank Nederland (Holding), and Luxembourg is to give Fortis Banque Luxembourg 2.5bn.

Each government will subsequently acquire a 49% stake in the relevant part of the bank.

Filip Dierckx, CEO of Fortis Bank, has stated that the widescale of support from the Benelux region is a sign of confidence in the firm.

In addition to this package, Fortis is to sell of RFS Holdings, its stake in ABN AMRO, with the exception of Asset Management which was previously transferred in Q2 of this year.

The third quarter will see a total after-tax value adjustment of around 5bn euros.

This adjustment will be due to a variety of factors, including shedding balance sheet risk, altering strategy and the changing market environment.

Core equity for Fortis will hit 30bn euros, 9.5bn higher than its target, and giving a Core Tier 1 Ratio, under Basel 1, above 9%.