Bank brings forward announcement to quell rumours
Fortis Bank will record a net loss of up to €19bn (£18bn) for 2008 due to the financial crisis and the break-up of the banking and insurance group that owned it.
The bank said that despite the losses, its liquidity and solvency had improved since the Fortis Group was split up in October after becoming one of the first European financial firms to seek a government bail-out.
The bank expects a €4bn-€5bn net loss for the fourth quarter due to a further deterioration in its structured credit portfolio, increased bad loans and a loss at its Global Markets trading division.
The Belgian state took ownership of Fortis Bank in October after a decision by the Dutch government to nationalise Fortis’s banking and insurance businesses in the Netherlands. The Luxembourg state owns 49.9% of Fortis Bank Luxembourg, a subsidiary of Fortis Bank.
The €14.5bn deal under which Belgium was to sell a 75% stake in Fortis Bank to BNP Paribas has been frozen by a court until shareholders in Fortis Group, the listed entity that previously owned all Fortis businesses, can vote on the transaction next month.
Fortis Bank said it had decided to publish the results, which it is not obliged to do, due to “all sorts of rumours” circulating about the bank’s position.
“We’re disappointed by these results,” said Filip Dierckx, chief executive of Fortis Bank who also previously served as an interim chief executive for Fortis Group.
“We are turning a black page in the history of the bank and as the management want to thank our customers, staff, the Belgian and Luxembourg states and BNP Paribas for their support and trust in these difficult times.”
He added that senior management would forgo bonuses for 2008.
