Reuters logo
Ageas urged to halt dividends until Fortis legal claims settled
August 5, 2014 / 1:35 PM / 3 years ago

Ageas urged to halt dividends until Fortis legal claims settled

BRUSSELS, Aug 5 (Reuters) - A lawyer for shareholders seeking compensation over the 2008 bailout and break-up of Dutch-Belgian lender Fortis urged the succeeding company, Ageas , on Tuesday to suspend dividend payments until legal claims are settled.

FortisEffect, which represents former investors, won a legal battle last week when a Dutch court ruled that Fortis had misled shareholders after a first rescue in September 2008 and should pay them compensation.

Insurance company Ageas has since said it will set aside 130 million euros ($174.0 million) for possible payments, while mounting an appeal..

Adriaan de Gier, the lawyer acting for FortisEffect, told Reuters that more than 12,000 former shareholders had registered with the claims foundation and that the required compensation was likely to be more than 1 billion euros.

In a letter to Ageas, De Gier said Ageas wished to make periodic dividend payments to shareholders but that such payments came at the cost of his clients’ chances of securing damages.

De Gier urged Ageas to stop any existing or future dividend payments or other similar action, such as buying back its own shares.

Ageas declined to comment on De Gier’s request.

The group will report first-half results on Wednesday, and some analysts have speculated that it could announce a new share buy-back programme given its strong cash and solvency position.

Fortis, once one of Europe’s largest banks, almost collapsed after paying a top-of-the-market 24 billion euros for the Dutch operations of ABN AMRO just as the credit crunch struck in 2007.

It received an 11.2 billion euro capital injection in September 2008, but that failed to calm markets.

A week later it was split up. The Dutch nationalised Fortis’s activities there, while France’s BNP Paribas bought a majority in Fortis’s banking operations in Belgium.

Ageas, the Belgium-based insurance business, is the legal successor. ($1 = 0.7470 Euros) (editing by Robert-Jan Bartunek and Jane Baird)

Our Standards:The Thomson Reuters Trust Principles.
0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below