ALLIANCE GLOBAL INVESTMENTS

In late 2007, Fortis, along with the Royal Bank of Scotland Group and Banco Santander, staged the largest banking acquitision ever when they jointly paid EUR 69-billion (USD $101-billion) to buy ABN AMRO Holding. Barely one year later, Fortis SA/NV was in financial ruin and was nationalized by Belgium. ABN AMRO's Dutch operations were sold to the Dutch government. Here is a brief timeline of the recent events:

November 2007: Royal Bank of Scotland, Fortis and Santander bought ABN AMRO Holding for EUR 69-billion (USD $101-billion).

2008: Banks around the world suffered massive losses (trillions of dollars, Pounds and Euros) from bad loans and bad investments.

2008-09-29: Fortis was on the brink of collapse. Belgium, Netherlands and Luxembourg jointly rescused Fortis by providing EUR 11.2-billion (USD $16.2-billion) in new capital.

-- Belgium bought 49% of Fortis Bank (Belgium) for EUR 4.7-billion
-- Netherlands bought 49% of Fortis Bank Nederland for EUR 4.0-billion.
-- Luxembourg bought 49.9% of Fortis Banque Luxembourg for EUR 2.5-billion

2008-10-03: Netherland revised its rescue by buying up all of Fortis Bank Nederland, Fortis' ownership in ABN AMRO Holding, as well as Fortis Insurance Nederland for EUR 16.8-billion. This new deal replaced the earlier deal to buy 49% of Fortis Bank Nederland for Eur 4.0-billion.

2008-10-05: Belgium stepped in a second time in a week and bought the remaining 51% of Fortis Bank (Belgium) for anther EUR 4.7-billion. The Belgian government now owned 100% of Fortis Bank Belgium at a cost of EUR 9.4-billion.

2008-10-05: Belgium and Luxembourg then worked out a deal with France's BNP Paribas to unload the nationalised banks to the French bank:

-- BNP Pairbas to buy 75% of Fortis Bank (Belgium) from the Belgian government and 67% of Fortis Banque Luxembourg (51% from Fortis SA, 16% from Luxembourg) for EUR 9.0-billion in BNP Paribas stock.
-- BNP Paribas to buy Fortis' insurance operations in Belgium for EUR 5.5-billion in cash.

2008-12-12: Belgian appeal court ruled that the sale of Fortis units to BNP Paribas was illegal and the Belgian prime minister had attempted to influence an earlier court decision. Belgian prime minister resigned because of the scandal. The original BNP Paribas deal died.

2008-12-22: To dissociate itself from the contaminated Fortis name, Fortis Bank Luxembourg changed its name to BGL (short form of Banque Generale du Luxembourg).

2009-03-08: Belgium and BNP Paribas agreed to a new deal:

-- Belgium to sell 75% of Fortis Bank to BNP Paribas for EUR 8.25-billion in BNP Pairbas stock. Fortis Bank holds 100% of Fortis Bank Belgium and 50.1% of BGL (formerly Banque Generale du Luxembourg).
-- BNP Paribas to buy 25% of Fortis Insurance Belgium from Fortis Holding for EUR 1.375-billion in cash.

(Belgium will continue to own 25% of Fortis Bank. The remaining Fortis Holding will own 75% of Fortis Insurance Belgium and 100% Fortis Insurance International (units outside of Belgium and Netherlands).

The 2009-03-08 agreement is subject to Fortis' shareholders approval.

The fortis building in Utrecht as seen from my apartment in Zeist (Anna Paulownalaan). The Provinciekantoor of Utrecht can be seen just to the left of the Fortis building. Taken around sunrise.

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