UPDATE 1-Dutch want management of rescued bank held accountable
* Former SNS head quits industry body
* FinMin sees no evidence of fraud
* Options limited for holding management to account
* No moves planned to squeeze senior debt holders (Adds resignation of former SNS head from industry group)
By Thomas Escritt
AMSTERDAM, Feb 3 (Reuters) - The Dutch finance minister said on Sunday he would look at whether those responsible for the mismanagement of SNS Reaal can be held accountable following last week's 10 billion euro rescue of the country's No. 4 bank.
The troubled banking and insurance group was nationalised on Friday after it failed to meet a Jan. 31 deadline for securing a capital injection to cover heavy losses in its property finance business. The bulk of the costs will be born by taxpayers, although other banks will have to contribute.
Finance Minister Jeroen Dijsselbloem, speaking on weekly television news programme Buitenhof, said the options were limited in terms of holding those responsible accountable for the losses.
But he said that Sjoerd van Keulen - a former chief executive of SNS Reaal and one of several managers facing criticism from investors - should step down from his post as chairman of Holland Financial Centre, an umbrella group for the Dutch financial sector which he has headed since leaving SNS Reaal in 2009. Within hours, Van Keulen had resigned.
Asked what legal steps could be taken against Van Keulen, who was chief executive between 2002 and 2009 and who was in charge when the bank took the fateful decision to acquire a property portfolio in 2006, Dijsselbloem ruled out a criminal prosecution, saying there was no evidence of fraud.
But he said that steps might be taken under civil law against those responsible for SNS Reaal's failure.
"I'm going to have people look into whether there is anything that can be done under civil law, but I think the possibilities are limited," he told Dutch public television.
A finance ministry spokesman later clarified that any such moves could relate to anybody who had sat on the board until the bank's nationalisation on Friday.
Dijsselbloem, who last month took over chairmanship of the group of euro zone finance ministers, was responding to public anger at the need to bail out yet another bank at a time of economic weakness and austerity measures.
SNS Reaal's top executives - chairman Rob Zwartendijk, chief executive Ronald Latenstein and finance chief Ference Lamp - resigned on Friday, saying they had wanted a private sector solution.
Before the credit crunch hit in 2008, the Netherlands was one of the world's leading financial sectors and its top banks and insurers had an international profile despite the country's small size. But as in many other countries, the sector has retrenched dramatically since then.
The Dutch government had to pay out 40 billion euros to rescue the domestic financial sector in 2008, when it provided capital injections for ING, Aegon and SNS Reaal, as well as nationalising ABN AMRO.
While most investors lost their money in the nationalisation of SNS Reaal, Dijsselbloem warned that any attempts to claw back money from owners of senior debt - whose securities were not expropriated by the state - could be counter-productive.
"I have to be careful that the Dutch financial sector doesn't become vulnerable because of this," he said, warning that senior debt issuance was an important source of finance for the Dutch financial sector.
But he said investors should be prepared to accept the risk of losing their money.
"Investors aren't always used to the idea that if it goes wrong you lose your money, but that's really part of investing."
He also defended the Dutch central bank, the regulator, saying it had improved its regulatory practices since 2008.
Dijsselbloem said SNS Reaal's collapse was an indication that the Netherlands, one of the last remaining triple A rated countries in the euro zone, was not the "best kid in the class".
"We have a budget deficit... a financial sector which is not yet in order, and we have very big problems in our housing and real estate markets," he said.
"The whole idea that you have the south with problems and the north (of the euro zone) which doesn't, is not correct. There are several northern countries that need serious changes." (Reporting By Thomas Escritt; Editing by Sara Webb and Stephen Powell)
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