The three-cornered rescue of Fortis last weekend, whereby the Belgian, Dutch and Luxembourg governments agreed to inject €11,3bn of emergency funds, clearly hasn’t worked.
On Friday, the bank was split asunder - the Dutch assets (the bulk of the business) being nationalised by the Dutch government. The Belgian and Lux sides of the business seem to remain as an independent entity for now and receives €16.8bn in return for the nationalised assets.
Where this money goes was not immediately clear.
Dutch Prime Minister Jan Peter Balkenende was quoted by Reuters as saying:
Deal generates cash for Belgium, can help solve problems there.
Given California’s experience earlier on Friday and the rumour mongering around Iceland, could it be that we are are now witnessing the Crunch moving up to the sovereign level?
Related links
Fortis to be transferred to Netherlands - Reuters
