Abn Amro

Save the banks

2009, a year that will never be forgotten by many people and certainly will not be forgotten by bankers. The crisis of 2009 was started by a big bubble as they called it in de financial industry.

During this financial crisis a lot of banks got in really big problems, one of these banks is ABN-Amro.

ABN Amro, a dutch bank that was created in 1991 when Algemene Bank Nederland, Amsterdam Bank and Rotterdam bank merged together. It was the second largest bank in Holland and number eighth in Europe. The bank has offices in 15 different countries and over 32 000 employees, 5000 of these employees are located in the Netherlands . In 2007 Abn amro was taken over by one of the biggest banks in de world namely Royal bank of Scotland group. To take over Abn Amro they had to create a lot of debt, right at this moment the financial crisis begins.

The banks couldn't pay the debt that they created, this could mean the end of four banks at the same time. The UK government decides to step in and take control of the situation, they bailed out about the Scottish bank and the life of ABN Amro was held on a thin line by RFS Holdings B.V. . The Dutch government decides to step in as well and save ABN AMRO en Fortis from going under. They decide to invest €4 billion, €2.5 billion will be done by Belgium and Luxembourg. This is by far one of the best decision ever made by de government, if they did not respond to what was happening during the crises a lot of people would have the same problem as the people whom had their money on a savings account on the Central bank of Iceland. On the stock marked the stock of ABN Amro immediately rose from 4€ to €6. Few days later it dropped again because of the news that the mortgages that ABN Amro and Fortis had no value. At this point it seems like a dead end of these two banks and that the government lost a lot of money.

After the government took over the banks the stock of Fortis was suspended, the price for which a stock would sell was 63% lower than before and they were facing a lot law suits from Verening van effectenbezitters (VEB) (Association of Stockholders). The Dutch side of the Fortis bank was nationalized and become property of the government. The Dutch government bought the ABN Amro name purchased companies within de group and closed them done to stop the decreasing stock.

The Dutch government would take control of all financial operations of Fortis, this was also including the ABN-armo one. The government was now fully owner of the banks. Later in 2010 ABN Amro group merged with the Fortis bank Nederland which leaded to Fortis name officially disappearing on the 1st of July. At the end ABN Amro had made it and now it was back in business again or not?

The Dutch government used a lot of money to keep abn Amro and Fortis bank alive,