'Fortis kept risky investment fund quiet'

Thursday 02 October 2008

An off-shore investment fund of €18bn appears to have been left off the books of Fortis during the Dutch-Belgian financial services group’s takeover of the Dutch operations of ABN Amro bank last year, reports Thursday’s Volkskrant.

Such a move makes it possible to keep high-risk activities away from too much scrutiny.

Dutch finance minister Wouter Bos told parliament yesterday that he wants to know whether he was given a full overview of Fortis’ balance sheet when he approved its acquisition of ABN Amro in the autumn of 2007.

According to the Volkskrant, the investment fund Scaldis, which was set up in 1999 on the Channel Islands, appeared in the quarterly results of Fortis for the first time shortly after the takeover.

The paper says investors could not see what sort of risks the company was running with the Scaldis investment fund. Analysts from SNS and Bank De Groot believe Fortis faces a loss of €500m on Scaldis as a result of the credit crisis, reports the Volkskrant.

The Dutch central bank gave the green light for the Fortis takeover of ABN Amro Nederland in the autumn of 2007, basing its decision on the company’s 2006 annual report which did not mention Scaldis, according to the paper.

© DutchNews.nl

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