[FONT="]BRUSSELS, Jan 28 (Reuters) - The European Union's competition authority approved a recapitalisation scheme for Dutch bancassurance company SNS Reaal on Thursday, saying the plan was in line with state-aid rules.[/FONT]
[FONT="]In December 2008, the Dutch state injected 750 million euros ($1 billion) of new capital into the company via Tier 1 securities, and at the same time the SNS Reaal Foundation, a shareholder, injected 500 million euros more.[/FONT]
[FONT="]The EU's executive European Commission temporarily approved that injection as part of rescue aid measures, but made it conditional on the presentation of a long-term viability plan for SNS within six months.[/FONT]
[FONT="]That plan refocused SNS's business model, concentrating it on the Dutch retail and small business market and shedding international project finance operations, and has now been approved by the EU authorities.[/FONT]
[FONT="]"The Commission's assessment shows that SNS's business model is viable," Competition Commissioner Neelie Kroes said in a statement.[/FONT]
[FONT="]"The state support received by SNS is of limited size and the financial projections submitted to the Commission show that thanks to a number of measures to reduce risks, SNS is now in a position to face up to adverse economic conditions."[/FONT]
[FONT="]SNS Reaal was formed via the merger of SNS Bank and Reaal Insurance in 1997.[/FONT]