ABN Amro asks state for capital injection

Wednesday 20 May 2009

Banking group ABN Amro does not have enough reserves to stand on its own two feet and has asked for a capital injection from the treasury, the NRC reports on Wednesday.

ABN Amro is in the process of consolidating Fortis Nederland following the two banks' nationalisation last year.

CEO Gerrit Zalm said the bank needed the cash during yesterday's press conference about plans to cut more jobs at the bank.

Zalm did not say how much money was needed other than it is 'a large sum', the NRC reported. The state paid Fortis Holding €16.8bn for ABN Amro's Dutch activities.

Divestments

The capital injection is linked to the sale of certain ABN Amro corporate banking units which European competition commissioner Neelie Kroes ordered last year, the paper says. ABN Amro is in the process of selling the Hollandsche Bank-Unie (HBU) to Deutsche Bank which will generate a large book loss.

The ministry of finance confirmed it was in talks with Zalm but said several issues affecting the bank are currently under discussion.

The NRC said Zalm hoped to finalise his capital plans before July 6, the deadline for the sale of HBU agreed with Brussels.

© DutchNews.nl

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