Business World

Tuesday 20 March 2018

McCreevy was irresponsible, says Dutch banker

Dutch central bank governor Nout Wellink
Dutch central bank governor Nout Wellink

Jurjen van de Pol

DUTCH central bank governor Nout Wellink accused EU Financial Services Commissioner Charlie McCreevy of an "irresponsible" reaction to his objection to the splitting up of ABN Amro bank in 2007.

"Brussels reacted sharply and fiercely," Mr Wellink, who also sits on the European Central Bank's governing council, told a Dutch parliamentary committee on the financial crisis in The Hague yesterday.

"I find it very irresponsible of a European commissioner that he doesn't even try to know the contents of my objection," he added.

Mr McCreevy warned Dutch regulators in April 2007 not to play favourites among bids for ABN Amro. He did so after Mr Wellink said a takeover by a consortium, such as that which eventually succeeded -- by Royal Bank of Scotland, Banco Santander and Fortis -- would be more complicated and risky than a single-entity deal.

Mr Wellink later approved the consortium takeover, which turned out be very costly.

Mr Wellink said Mr McCreevy postponed a meeting with him several times, after which the central banker cancelled the appointment. Mr McCreevy's office had no comment, spokesman Oliver Drewes said by telephone.

The parliamentary committee, led by Socialist Party lawmaker Jan de Wit, is investigating the causes of the financial crisis and the Dutch government's response to it.

The Netherlands bought Fortis's Dutch banking and insurance units and the company's stake in ABN Amro for €16.8bn in October 2008, after the parent company ran out of short-term funding -- as customers withdrew deposits and investors lost confidence.

Mr Wellink also told MPs that he believed Icelandic financial regulators lied to him about the situation in that country's banks several months before they ran into problems. Referring to a visit by a delegation from the Dutch central bank to Iceland's financial services regulator in August 2008, Mr Wellink said: "We asked how the banks were doing. 'Fantastic,' they said."

Mr Wellink said Iceland's central bank president told him in September 2008 in Basel, Switzerland, that he had warned the Icelandic government about the banks six months earlier. "When he said that, I thought: they've been lying to us."

Irish Independent

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