Dutch State nationalizes SNS REAAL
Newsflash | 02/01/2013
The Minister of Finance in consultation with the Dutch Central Bank (DNB) SNS REAAL nationalized. The savings from customers is safe and services SNS REAAL is guaranteed. With the surgery are major problems for financial stability and prevent the economy.
Financial stability assured, the private sector pays them
Nationalization based on the Intervention is necessary because SNS REAAL in acute emergency has come due to problems with the property portfolio. DNB had set a deadline of January 31 to 18:00 h with a solution. Without a solution SNS Bank would go bankrupt and the financial system in serious and immediate danger. After DNB determined that the expiry of the deadline, no solution was found, nationalization was inevitable to ensure financial stability in the Netherlands. "I have all the alternative solutions market in detail. But last night I found that there is no acceptable solution is offered. Therefore, I have the utmost means of nationalization should deploy. Thus the financial stability guaranteed and great damage to the economy occur. I can empathize with the resistance that many will feel again because a large amount of public money is required. Therefore I want the private sector as much as possible to help pay for the rescue of SNS REAAL. "Says Minister of Finance Dijsselbloem.
The private sector helps pay for this solution where DNB is still viable. This means that the shareholders and subordinated creditors are expropriated. This saves the state 1 billion in costs. In addition, a special, one-time charge of Resolution 1 billion to the banks in 2014.
The surgery and the budgetary implications
DNB has determined that additional financial measures necessary for the stability of SNS REAAL. The problematic real estate branch is separated from SNS. The cost to the State of these measures are 3.7 billion. These costs consist of 2.2 billion euros of new capital injections, 0.8 billion as depreciation of earlier aid, and 0.7 billion for the remote places of the property. In addition the State 1.1 billion in loans and guarantees to 5000000000. This causes a deterioration of the EMU balance in 2013 of 0.6% and an increase of the EMU debt of 1.6%.
Savings are safe
For depositors and other customers, there are no changes. Services for the clients of SNS REAAL with 1.6 million savings accounts and current accounts 1,000,000 is continued and the savings of depositors is safe.
Moderation of salaries
The CEO and CFO of SNS REAAL, Messrs Latenstein and light, have announced their resignation to offer. The new board will consist of Mr. Van Oostendorp and Olphen. The Chairman of the Supervisory Board, Mr. Zwartendijk, has offered its function. Its function is temporarily assumed by the current Vice-Chairman Overmars. Bonuses for Directors were and are not discussed. When the setting is on top of the existing bonus ban, expected wage.
Future of SNS
The new management has the task once the company has stabilized and the market permits parts in private hands to bring.
Preventing government intervention
New action is a setback for the Dutch financial sector back on their feet to leave. The minister wants this type of costly government intervention in the future. Minister Dijsselbloem: "The banks should in future issues much better to separate. So do not need the whole setting to be saved, but only the relevant audience share. In the European context would be regulated in the future, all private parties as possible to pay the bill. "
Technical aspects
The decision to expropriate and the press release which announced the expropriation can be found on the website.
In 2014, a one-time, in the treasury flowing resolution levy on banks fines totaling EUR 1 billion. This levy will not be deductible for corporation. The contribution of the different banks will be related to the total amount of the deposit guarantee scheme under the guaranteed deposits on 1 February 2013 they held.