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* Fortis was bailed out and carved up in 2008
* Prosecutors say directors misled shareholders, markets
BRUSSELS, Feb 20 Belgian prosecutors have
concluded that seven former directors of Fortis should face
trial for allegedly misleading investors during the
Belgian-Dutch bank's purchase of part of Dutch lender ABN AMRO
and before its 2008 collapse.
A dossier has been passed to a panel of judges who will
determine whether to order a trial, Brussels prosecutors said on
Wednesday. They did not name the former Fortis directors.
Ageas, the legal successor to Fortis, said it was pleased
that the prosecutors were not seeking to bring it to trial as
well. It declined to comment on its former directors.
Allegations by the prosecutors revolve around whether
communications to investors about Fortis's exposure to U.S.
sub-prime assets were insufficient or too late, such as at the
time of a capital increase when Fortis bought part of ABN AMRO.
The seven would be the first in Belgium to face trial over
banking failures during the crisis, which also forced bailouts
for Franco-Belgian group Dexia and Belgian company KBC
Fortis, once one of Europe's largest banks, got into trouble
after paying a top-of-the-market 24 billion euros ($32 billion)
to buy the Dutch operations of ABN AMRO just before the credit
Shareholder groups have complained that former chairman,
Maurice Lippens and former CEO Jean-Paul Votron repeatedly
assured markets that Fortis's balance sheet was strong and that
it would not be changing its dividend policy. Repeated calls to
Lippens' home were unanswered.
Votron's lawyer referred to a statement made by Votron in
Belgian business daily De Tijd on Wednesday, in which he said
that he had never lied to financial markets and that he and
Fortis board members had always acted with the greatest possible
At the end of June 2008, Fortis scrapped its interim
dividend and sold new shares to prop itself up.
A Dutch court found Votron and ex-finance director Gerald
Mittler guilty last year of misleading shareholders from May to
June 2008, but cleared Lippens. Both have appealed and the case
is still pending.
Fortis was finally split up in October 2008, a week after an
11.2 billion euro capital injection failed to calm markets. The
Dutch nationalised Fortis's activities there, while BNP Paribas
bought a majority in Fortis's banking operations in Belgium.
The remaining Fortis business, renamed Ageas, was
left as an insurance group centred on Belgium with life and
non-life insurance operations elsewhere in Europe and Asia as
well as a host of legacy issues to clear up related to Fortis's
(Reporting By Philip Blenkinsop. Editing by Jeremy Gaunt.)