Judge orders Fortis investigation

This week, on the 24th of October, a Dutch judge ordered a major independent investigation into the break-up of the Fortis group to establish if there was mismanagement. They also decided that Fortis should pay all costs related to the investigation estimated around 600,000 Euro.

The VEB (an organisation that represents the small shareholders) who took the matter to court is pleased with the decision of the Dutch company court.

Although the decision was to be expected after the outcome of a similar Belgian case earlier this month, the trade of Fortis shares on the Amsterdam and Brussels stock exchanges was suspended during the trial

Raf Van Bulck

Source: De Tijd

Key moments in the Fortis crises

17/10/2007: Fortis purchases ABN Ambro. This is the beginning of the end. The financing of this deal put the shares under a lot of pressure.
26/06/2008: Fortis announces unexpectedly that a capital increase of 1.5 billion euro is necessary and that they will have to cancel the interim-dividend. The shares lose 19%.
11/07/2008: CEO Jean-Paul Vorton resigns and Herman Verwilst takes his place.
01/08/2008: Financial director Gilbert Mittles also resigns, he is appointed ‘special adviser of the CEO’.
15/09/2008: The American Bank Lehman Brothers goes bankrupt. Because of this the Interbanking Market stops working and the rate for liquidities skyrocket.
26/09/2008: At a press conference Fortis states that there are no liquidity or solvability problems. That same night Verwilst is replaced by Filip Dierckx. It seems that the financial crises was dramatically. A lot of clients take away their money, a total of 20 million euro.
28/09/2008: The governments of Belgium, Luxemburg and the Netherlands decide to invest 11.2 billion euro in Fortis. Fortis has to sell its holding in ABN Ambro. Maurice Lippens resigns as president of the Board of Directors.
03/10/2008: The Belgium government announces that they will sell Fortis Netherlands and ABN Ambro to the government of the Netherlands for 16.8 billion euro.
06/10/2008: The Belgium government sells 75% of Fortis Bank and Fortis Insurance Belgium to BNP Paribas.

Source: De Standaard

Tine Van Landeghem

De Gucht accused of selling stocks with prior knowledge

The efforts of the government to save Fortis Holding are still causing problems. Not only are stockholders filing a complaint in order to cancel the takeover by BNP Paribas, politicians too are being criticised.

One politician in particular, K. De Gucht, is accused of giving 'sensitive' information during the negociations between the Belgian government and BNP Paribas, to his spouse, M. Schreurs. De Gucht allegedly would have told her to sell her stocks, which is regarded as an act with prior knowledge. Vlaams Belang filed a complaint against De Gucht and the CBFA as well is investigating this matter. De Gucht dennies all accusations and hopes that the court of law will do its job so there will be ‘clarity’ in this case.

Daan Van Parys

Source: Tijd

Fortis makes arrangements for a second shareholders meeting

Fortis will be gathering its shareholders a second time on the 19^th of December, reports Fortis Holding. Shareholders will have to decide, wether or not, Fortis Holding will continue to exist. Recent statements, made by the public prosecutor, worried shareholders. Furthermore, they shall be asked to appoint a new head to the board of directors. Favourite to this position is E. Davignon, former head of the board and friend of E. Lippens.

In the meantime, prime minister Y. Leterme warns Fortis shareholders against a possible rejection of the takeover by BNP Paribas, which is set on the 4^th of December.

Daan Van Parys

Source: Tijd

Court of law ratifies sale of Fortis

The judge declared today the sale of Fortis legally valid. According to her the sale was the only solution to safe the bank/insurer and the assets of the savers. She says the stockholder would be left with nothing if the sale did not go through and that the suspension of the sale now only would let to irreparable consequences for the current financial market situation.
However she also stated that the stockholders have the right to have exact information at one’s disposal. A commission of experts will be constituted to investigate the correctness of the compensation of their stocks and to check how the communication with the stockholders passed off.
One of the accusers lawyers, lawyer Modrikamen, doesn’t agree with this verdict and announced he will appeal.

Lotte Van Meirvenne
source: http://www.deredactie.be/cm/de.redactie/economie/081118_fortis_schorsing

An extra 3 billion euro loan

Not the government but the stock market listed Fortis concealed that the government holding backed up Fortis with a loan of 3 billion euro.

After already given a capital contribution.
Everything goes to show that they did every thing to cover up the matter at the very most.

Three days after the announcement that BNP Paribis would buy Fortis Bank, BNP Paribas asks for a re-negotiation. It turned out that Fortis had a 2.5 billion debt with the bank. Because of that Fortis Holdings didn’t have as much cash as they assumed.

So the government backed up 3 billion euro to prevent that de BNP Paris lowerd their bid price.

Source:

http://www.standaard.be/Artikel/Detail.aspx?artikelId=DMF15112008_050&ref=rss

Tine Van Landeghem

Fortis definitely sold correctly?

Last week the public prosecutor stated the sale of Fortis to BNP Paribis not legally valid. The lawyers of Fortis, BNP Parabis and the government now declared in summary proceedings that Fortis was definitely sold correctly and the government was definitely allowed to negotiate.

According to the law the stockholders’ meeting mustn’t deal with the sale of parts of Fortis. The defence states this would lead to an even bigger insecurity on a market that is already in recession.

This summary proceedings are only temporary proceedings and cannot leave finale decisions to the stockholders’ meeting. The commercial court of Brussels will give a verdict next Tuesday.

source: http://www.deredactie.be/cm/de.redactie/economie/081112_Fortis_Verdediging

Lotte Van Meirvenne