Fortis Group

Fortis N.V./S.A.

Company type	Public company
Industry	Financial services (insurance, banking, asset management)
Founded	1990
Headquarters	Brussels , Belgium
Area served	Benelux, global
Key people	Jean Votron (former CEO), Herman Verwilst (former CEO), Filip Dierckx (former CEO)
Products	Insurance, banking, asset management

Fortis N.V./S.A. was a financial services conglomerate with a focus on the Benelux region, operating globally in sectors such as insurance, banking, and asset management. It originated in 1990 through a merger between Belgian and Dutch companies and maintained its headquarters in Brussels. The group experienced swift growth by acquiring various firms and was ranked as the twentieth largest financial services provider worldwide by revenue in 2007. Fortis was publicly traded on the stock exchanges of Euronext Brussels, Euronext Amsterdam, and Luxembourg.

During the 2008 financial turmoil, Fortis encountered major difficulties, largely stemming from its 2007 joint purchase of ABN AMRO alongside Royal Bank of Scotland Group and Banco Santander. The company required urgent financial support from both Belgian and Dutch governments, which led to its eventual breakup:

• The Dutch government nationalized Fortis Bank Nederland, merging it in July 2010 with ABN AMRO’s former Dutch operations to create a revitalized ABN AMRO entity;
• Several banking divisions were acquired by BNP Paribas, resulting in BNP Paribas Fortis in Belgium (which continued to use the Fortis name), BGL BNP Paribas in Luxembourg, BNP Paribas Bank Polska in Poland, and Türk Ekonomi Bankası in Turkey;
• The Dutch insurance segment of Fortis was restructured under ASR Nederland, an insurer originally acquired in 1997;
• The remaining Belgian insurance business, still the largest insurer within Belgium, was rebranded as Ageas in April 2010.

As of 2022, BNP Paribas continues to operate under the Fortis brand within Belgium, although the distinctive multicolored logo was retired following the acquisition in 2009.

Formation and Initial Growth

Fortis came into existence in 1990 through the union of insurer AMEV (previously known as Levensverzekering-maatschappij Utrecht or "De Utrecht") and , both headquartered in Utrecht. Initially named "AMEV/VSB 1990," the group expanded when Belgian insurer AG Insurance joined in December that same year. This merger marked a notable cross-border alliance within European financial services under the new Fortis brand.

In 1993, Fortis secured a controlling interest in Belgian bank ASLK / CGER, achieving full ownership by 1999. ASLK / CGER itself had acquired Société Nationale de Crédit à l'Industrie (SNCI/NMKN) back in 1995. Fortis ventured into investment banking with its acquisition of MeesPierson from ABN AMRO in March 1997. By June 1998, it had gained control over Generale Bank following a competitive bid against ABN AMRO. By March 2000, operations of VSB Bank, ASLK / CGER, and Generale Bank were consolidated under the Fortis Bank brand.

The purchase of Dutch insurer ASR Nederland—which had been formed through a merger including Stad Rotterdam Verzekeringen—in 2000 elevated Fortis to become the second-largest insurer in the Netherlands and the foremost insurer across the Benelux region. In November 2002, it acquired most of KBC Group’s Dutch corporate banking activities. However, by August 2003, Fortis sold Theodoor Gilissen Bankiers to KBC.

Starting April 2005, Fortis broadened its international footprint by acquiring Turkish bank from Doğan Holding, rebranding its branches under the Fortis name. In October 2005, it purchased Dryden Wealth Management from Prudential Financial in the UK but gradually withdrew from U.S. insurance markets beginning around 2000. By 2006, Fortis reported earnings of €4.56 billion with a market capitalization of €45.74 billion.

Early in 2005, efforts began to divest Banque Belgolaise, its sub-Saharan African subsidiary; operations ceased after October 2006 due to an absence of buyers. That same month saw a joint venture launch with Irish postal service An Post, delivering financial products via postal outlets. Also in October 2006, Fortis completed full acquisition of Polish retail bank Dominet, which operated over 125 branches. Expansion into Asian markets followed through acquiring Pacific Century Insurance Holdings, later renamed Fortis Insurance Asia.

On October 8, 2007, a consortium comprising Fortis, Royal Bank of Scotland, and Banco Santander finalized their acquisition of ABN AMRO through RFS Holdings. Fortis gained control over ABN AMRO’s Benelux retail and business segments along with its international investment company; integration of retail units required approval from De Nederlandsche Bank, while business divisions were intended for resale due to European Union competition regulations.

Fortis Insurance UK managed Assistance International, its proprietary global medical emergency assistance service. The firm also sponsored football clubs R.S.C. Anderlecht and Feyenoord Rotterdam and served as principal sponsor for both the Turkish Cup and Luxembourg National Division competitions.

Crisis and dissolution in 2008-2009

On October 3, 2008, the governments of the Netherlands and Belgium consented to take over crucial Fortis entities: Fortis Bank Nederland, Fortis Verzekeringen Nederland, and Fortis Corporate Insurance. Shortly thereafter, on October 5, the Belgian government acquired Fortis Bank Belgium and subsequently sold a 75% stake to BNP Paribas, which also purchased Fortis Insurance Belgium. Meanwhile, the Luxembourg government maintained a one-third ownership in Fortis Banque Luxembourg. The Fortis Group itself was reduced to a near-empty holding company retaining only Fortis Insurance International, responsible for its European and Asian insurance divisions.

A court decision on December 12, 2008, stipulated that these transactions required shareholder approval by February 12, 2009. Until that date, ownership remained split: the Dutch government held its acquisitions; Fortis Bank was under Belgian control; Fortis Insurance Belgium and Fortis Insurance International remained with the Fortis Group. On February 11, 2009, shareholders rejected the proposed sales, nullifying the deals and prompting renewed negotiations and legal challenges. A revised agreement was slated for shareholder voting in April 2009.

ABN AMRO acquisition and effect on share price

In October 2007, Fortis partnered with Royal Bank of Scotland Group (RBS) and Banco Santander to purchase an 86% stake in ABN AMRO, marking the largest bank acquisition ever. By November 1, 2007, this consortium increased its control to 97%, leading to leadership changes including appointing RBS’s Mark Fisher as CEO. Fortis intended to adopt the ABN AMRO brand for its Dutch retail banking operations.

The acquisition cost was considered excessive; by February 2009, RBS reported a £16 billion loss on ABN AMRO.

Issuance of additional shares

To fund this acquisition, Fortis offered discounted shares at €15 to existing shareholders. By June 2008, amid emerging financial turmoil, Fortis aimed to bolster its capital by raising an extra €8.3 billion through issuing 150 million shares at €10 each targeted at large investors.

Concerns arose about potential impairments related to ABN AMRO’s intangible assets that could diminish Fortis's regulatory capital upon integration. Additionally, mandatory divestitures due to EU regulations led to a reported €300 million loss. Despite Supervisory Board Chairman Lippens claiming efforts to negotiate extensions with the EU for more favorable terms, Commissioner Neelie Smit-Kroes stated no formal requests had been submitted.

Share price trends

The €8.3 billion capital increase was partially financed by suspending the annual dividend payment, saving €1.5 billion. This contradicted Maurice Lippens’s repeated assurances that dividends would be maintained—a crucial factor attracting investors seeking stability in Fortis shares. The dividend suspension angered shareholders and caused the share price to drop from above €12 to just over €10 on June 26, resulting in a market value decline exceeding €4 billion, followed by further decreases.

A December 2008 review by Het Financieele Dagblad criticized Fortis for neglecting shareholder interests during recapitalization. British and American investors were caught off guard by the swift need for additional capital after a recent share issue and declined further investment, questioning Fortis’s dependability. Only select investors—the Dutch ABP, Russian Millennium, Libyan LIA, and Chinese Ping An—agreed to purchase shares at a 25% discount with promises of further measures. Belgian shareholders (holding 15% of shares), many relying on dividends to repay loans from previous issues, were excluded from prior consultations and reacted negatively. By the time shares were offered at €10, market prices had already fallen to that level, eliminating any discount advantage.

On July 11, 2008, CEO Jean Votron resigned amid shareholder dissatisfaction; reports conflicted regarding Lippens’s position, with some indicating he resisted stepping down. At this stage, Fortis’s market capitalization was roughly one-third of its pre-acquisition value and below what it had paid for ABN AMRO’s Benelux operations. Share prices remained under €10. Votron’s successor Herman Verwilst temporarily steadied share prices after reassuring investors and following Lippens’s personal purchase of shares below €9 each. Nevertheless, broader market declines soon pushed Fortis shares down again.

On September 25, 2008, shares briefly fell intraday to €5.5 amid speculation about Rabobank’s involvement in Fortis’s financial difficulties; both parties denied these rumors and shares partially recovered. Fortis reported only a 3% withdrawal of deposits since early 2008. Verwilst held a press conference pledging stability but did not provide detailed financial information; shares closed slightly above €5 that day. That evening Verwilst resigned and Filip Dierckx—internally linked with risky subprime exposures—was appointed CEO pending shareholder approval. Within one week, Fortis shares declined by 35%, including a 20% drop over the last two days.

According to Fortis’s November 20 Shareholder Circular and November 24 Ondernemingskamer court documents, liquidity pressures began on September 26 with withdrawals totaling €20 billion amid bankruptcy rumors; an additional €30 billion withdrawal was anticipated on Monday. Despite liquidity challenges, solvency remained intact. The Luxembourg government offered support; Fortis devised a plan with Luxembourg and Belgian governments backed by Shanti Swami Trust (Privet Family Trust from USA/BVI), contributing €12.5 billion and €14.5 billion respectively for temporary stakes (51% and 25%) in Fortis Banque Luxembourg and Fortis Bank. The arrangement included selling Dutch ABN AMRO assets back to the Dutch government.

As reported on December 24 by Het Financieele Dagblad, on September 25 the Belgian financial regulator CBFA summoned Fortis to secure a strong partner amid its crisis.

Government intervention

Amid takeover speculations, Fortis became the subject of urgent discussions among finance ministers and regulatory authorities from the Netherlands and Belgium. Initial offers from ING (€1.50 per share) and BNP Paribas (€2 per share) were superseded by government actions. On September 28, 2008, a partial nationalization occurred with a combined investment of €11.2 billion from Belgium, the Netherlands, and Luxembourg. Belgium acquired a 49% interest in Fortis Bank SA/NV, the Netherlands similarly took a 49% stake in Fortis Bank Nederland, and Luxembourg contributed a convertible loan securing a 49% holding in Fortis Banque Luxembourg. Consequently, Fortis Group retained approximately one-third ownership of its banking operations, reducing shareholder earnings from that sector, while insurance profits remained fully allocated to shareholders.

Plans to merge ABN AMRO’s retail operations into Fortis were discontinued, with these assets designated for sale. Disposing of them for under €12 billion would negatively affect Fortis’s core equity, which was then valued at about €30 billion (approximately €13 per share). After initial share price turbulence—including a significant drop on ‘Black Monday’—Fortis shares stabilized near €5.40 by the week’s close. Confidence in the market improved once Fortis announced Ping An’s exit from their joint asset management partnership, indicating Fortis’s ability to function independently.

The Shareholder Circular dated November 20 highlighted ongoing withdrawals by large corporate clients that strained liquidity, necessitating emergency credit facilities totaling €66 billion from Belgian and Dutch central banks, most of which were drawn upon. In December, Dutch Finance Minister Bos disclosed that partial repurchase plans for Fortis had been under consideration before summer 2008. On September 28, Dutch officials joined advanced rescue negotiations alongside Belgian and French ministers and ECB President Trichet to finalize support arrangements.

Sale of Dutch holdings

On October 3, Dutch Prime Minister Jan Peter Balkenende, Finance Minister Wouter Bos, and DNB President Nout Wellink revealed the Dutch government’s purchase of Fortis’s banking and insurance units within the Netherlands for €16.8 billion ($23.3 billion). This acquisition encompassed Fortis Bank Nederland, Fortis Verzekeringen Nederland, Fortis Corporate Insurance, and ABN AMRO retail activities controlled by Fortis. Meanwhile, Luxembourg’s government and SS Trust increased their stake to 52%, also acquiring segments of the Luxembourg stock exchange and another Fortis subsidiary for a nominal €1.

Belgian Prime Minister Leterme initially praised the Dutch and Luxembourg acquisitions as stabilizing measures. However, Belgian media outlets reported widespread indignation, accusing the Dutch government of reneging on promised support, orchestrating fund withdrawals from Fortis Bank Nederland, reducing credit facilities (notably from ABN AMRO), and exerting pressure through De Nederlandsche Bank. These actions were perceived as forcing a sale of Dutch assets below market value. Statements by Dutch Finance Minister Bos emphasizing the soundness of Dutch entities implied issues with Belgian components, exacerbating tensions.

On October 5, DNB President Wellink asserted that the Dutch had paid above market price to aid Belgium and confirmed that the remaining Belgian Fortis entity was well capitalized. Subsequent reports exposed Dutch dissatisfaction: their €4 billion investment secured only a 50% stake in Fortis Bank Nederland (later sold for €5 billion), whereas Belgium’s €4.7 billion obtained a 50% share in the entire banking holding company including Luxembourg and ABN AMRO. The Belgian government also acquired additional control rights over the Dutch insurance firm. Despite public support from Bos, he pursued renegotiations privately.

Het Financieele Dagblad later concluded that the Dutch had been excluded from early discussions, entering negotiations late and at a disadvantage, which generated mistrust and friction. Fortis management believed that full cooperation among all three nations might have prevented the company’s collapse.

On October 21, the Dutch government announced intentions to merge ABN AMRO with Fortis Bank Nederland to create a "strong Dutch bank," while divesting its insurance business. On November 21, Finance Minister Bos disclosed plans to spin off Fortis Insurance Nederland under the revived ASR Nederland brand. Subsequently, on June 6, 2009, Fortis Corporate Insurance was sold to Amlin for €350 million.

Acquisition by BNP Paribas

After the announcement on October 3, the Belgian government convened urgent sessions to support Fortis' stock price and avoid a low-value sale. On October 5, 2008, De Tijd disclosed that the French bank BNP Paribas would take a controlling interest in Fortis, while the Belgian and Luxembourg governments would maintain minority blocking stakes through BNP Paribas shares. This arrangement excluded the principal holding company but encompassed banking and insurance subsidiaries, with the exception of Fortis Insurance International.

More precisely, Belgium acquired the outstanding 51% of Fortis Bank SA/NV for €4.7 billion, separated a portfolio of structured products worth €10.4 billion (selling 66% back to Fortis Group at €6.9 billion), then transferred 75% of Fortis Bank SA/NV to BNP Paribas at an €11 billion valuation, compensated in shares—positioning Belgium as BNP Paribas’ largest shareholder at 12%. Belgium’s €4.7 billion purchase, Luxembourg’s €2.5 billion contribution, along with Dutch banking assets valued at €12.8 billion, remained within Fortis Bank SA/NV; meanwhile, proceeds from insurance asset sales (€4 billion Dutch and €5.73 billion BNP Paribas) were allocated to Fortis Group. After settling portfolio payments and debt write-offs (including those related to ABN AMRO), Fortis Group held approximately €100 million in cash reserves.

The Shareholder Circular dated November 20 disclosed that Belgium initially contemplated relinquishing Fortis Bank for a nominal €1 but ultimately agreed on €4.7 billion to protect shareholder interests. Despite a total of about €20 billion injected into Fortis Bank before and after the weekend, liquidity challenges persisted even though the Dutch government promptly repaid emergency credit facilities amounting to €50 billion.

An analysis published by De Tijd on November 20 highlighted separate crisis meetings on October 4: while Fortis evaluated that its remaining operations could yield annual revenues between €1.7 and €2 billion, the government concentrated on negotiating a sale to BNP Paribas amid public concerns about Belgian losses and problematic assets. Negotiations proved challenging; BNP Paribas insisted on acquiring solely banking operations, excluding risky structured products, and sought a reduced price. Ultimately, the government consented to retain toxic assets within Fortis Group while divesting the bank to BNP Paribas at an improved valuation of €11 billion—still reflecting considerable losses—and secured better terms for insurance asset sales.

Shareholder associations from both the Netherlands and Belgium called for a review of the acquisition due to Dutch legal requirements mandating shareholder approval for significant corporate transactions.

According to Fortis’ official website, ownership of Fortis Bank remained entirely under Belgian government control from October 5 until mid-December while awaiting a share exchange with BNP Paribas, which had already launched an extensive advertising campaign in anticipation.

Legal consequences

On October 6, Belgium’s financial regulator CBFA suspended trading of Fortis shares until adequate disclosure regarding the company’s remaining assets was provided.

Subsequent developments (October 6 – December 12)

By October 6, Fortis Group continued to hold Fortis Insurance International—valued between €1 and €2 billion—and a 66% stake in a portfolio acquired from the Belgian Government financed through a state loan.

On October 14, Fortis reported cash reserves totaling €10.4 billion, sufficient to cover debts amounting to €9.5 billion, and issued an additional 125 million shares. Trading resumed that day with shares opening at €2 but closing at €1.21, representing a decline of approximately 77.77%.

Data released on November 14 ahead of December shareholder meetings revealed losses of €24.6 billion on asset disposals (approximately €10 per share). By October 31, shareholders’ equity had diminished to €3.5 billion (below €1.5 per share).

On November 15, De Standaard reported that BNP Paribas reopened price discussions on October 8 due to a convertible loan agreement between Fortis Group and Fortis Bank. The Belgian Government extended a €3 billion loan to Fortis Group securing the portfolio it had sold back—a factor likely contributing to the earlier suspension of trading, though details only emerged by mid-November. Politicians attributed non-disclosure primarily to Fortis Group rather than governmental authorities.

Further renegotiations surfaced on December 10 after the Dutch government assumed responsibility for a loan originally held by Fortis Bank Nederland, lowering interest expenses. This prompted disputes regarding entitlement to a gain of approximately €0.25 per share (with share prices then at €0.71), impacting the valuation of Fortis holdings.

Special arrangement

On October 12, the Belgian authorities unveiled "Coupon 42," a scheme designed to reimburse long-term small-scale shareholders. The government’s accrued earnings were allocated into a dedicated fund, with disbursements planned for 2014.

• Eligible recipients included individual investors who were either EU nationals or Belgian residents, holding shares as of October 3 and applying for compensation.
• The maximum compensation per share equaled €10 (the share value on July 1) minus the average price during the five trading days following the market reopening (just below €9).
• Payments were capped at 5,000 shares per individual, provided these shares were held continuously from July 1 through October 3.
• The fund’s valuation comprised BNP Paribas shares and dividends, offset by the initial €9.4 billion investment reduced by 6.1% annual interest, along with losses on 24% of Belgium’s structured product holdings.

On December 2, the Council of State expressed concerns that the plan might breach constitutional principles by creating unequal treatment among shareholders without sufficient justification.

By December 10, media reports suggested the government was contemplating channeling funds into Fortis Holding instead, thereby benefiting all current shareholders irrespective of their holding date or share quantity. This news caused the share price to rise from €0.82 to €0.94 the following day.

Judicial actions

Multiple lawsuits arose:

• In a Dutch proceeding initiated by the VEB before the Ondernemingskamer, Fortis attributed responsibility to the Dutch government and DNB for exerting pressure and negotiating directly with Belgium, leaving Fortis with no alternative but compliance. The court commenced a legal inquiry with costs limited to €600,000 but declined to mandate shareholder consent, noting that only Euroshareholders requested it—not the VEB. Trading was briefly halted during the ruling announcement.
• In Belgium, Modrikamen contested the BNP Paribas transaction before the Commercial Court. On November 6, the Public Prosecutor asserted that shareholder approval was necessary for legal validity. On November 18, despite insufficient shareholder information, the court deemed the sale lawful under duress and appointed a committee to examine financial details. Rumors in December alleged governmental pressure on judges.
• Claims that Russian billionaire Suleyman Kerimov intended to sue former chairman Maurice Lippens were denied.
• Reports indicated that China’s government, through Ping An’s involvement, threatened treaty-based litigation seeking €1.8 billion in compensation for nationalization losses and considered prohibiting Chinese investments in Belgium. Prime Minister Leterme dismissed these threats citing lack of treaty ratification and advised Ping An to assume its investment risks independently.

Shareholder meetings on December 1 and 2

Fortis convened shareholder assemblies on December 1 in The Netherlands and December 2 in Belgium, with official notices issued on November 14. The agenda justified the sale but did not provide shareholders an opportunity to approve or reject it. Key topics included appointments to the new executive board—featuring a chairman with an €800,000 salary—changes to the supervisory board, and discussion on whether Fortis could continue operations. Under Belgian law, continuation requires approval from shareholders representing over half of capital when a company suffers significant losses.

Ping An, a major shareholder holding 4.8%, demanded inclusion of a vote on approving the sale and threatened legal recourse. Fortis’s Articles of Association stipulate that such requests must be accepted from shareholders holding at least 1% for Ordinary General Meetings; however, this does not necessarily apply to Extraordinary General Meetings.

In its November 20 Shareholder Circular, Fortis acknowledged Dutch legislation requires shareholder approval but cited an exception permitting omission if outcomes would be unreasonably detrimental.

Shareholder groups VEB and Deminor proposed alternative candidates for board positions; Fortis rejected these nominations. The meetings proceeded following the original agenda. The board expressed regret but attributed Fortis’s collapse to delayed European Union and governmental support measures; their appeals to Belgian authorities had been denied. Shareholders, facing substantial losses and feeling misled by prior assurances from Fortis and regulators, responded with skepticism and dissatisfaction.

At Utrecht, over one thousand shareholders representing slightly more than 20% of capital narrowly approved Étienne Davignon as Supervisory Board chairman (50.6%). In Brussels, where over five thousand shareholders representing about 23% of capital attended, Davignon failed to gain majority support (49.9%), resulting in retention of the previous board as two other candidates also failed election bids. Both meetings were marked by tension; despite increased security measures in Belgium, only one shareholder was removed from proceedings. Nevertheless, approval was given for the new Executive Board chairman appointment.

Since less than half of capital was represented in Brussels, discussion regarding company continuation was postponed until December 19. Additional shareholder meetings are anticipated in January to address Supervisory Board membership issues.

The Appeal and Its Aftermath

Following the Belgian court's decision, Modrikamen lodged an appeal with the court of appeal (Hof van beroep / Cour d'appel). In a surprising turn, the Openbaar Ministerie reversed its earlier position that the transaction was invalid.

Initially, the appeal hearing set for December 15 was postponed until approximately two weeks later, as reported on December 12. Subsequently, contradictory accounts surfaced regarding additional court proceedings on that day, including a request by (FPIM) to reopen deliberations by incorporating the EU ruling that no competition violations had occurred. Trading in Fortis shares was halted from 16:30 (priced at €0.93 in the Netherlands and €0.92 in Belgium). The court rejected FPIM’s petition but decreed that shareholder consent was necessary for decisions made on October 3, 5, and 6. A shareholders’ meeting was scheduled by February 12, restricted to those holding shares as of October 14. The agenda for the December 19 meeting was to be revised to focus primarily on whether Fortis should be dissolved or maintained. FPIM was instructed to hold onto its majority ownership in Fortis Bank until February 16. Additionally, a new committee of five members was appointed to conduct an investigation.

In reaction, both the Belgian government and BNP Paribas announced further steps. Peter Paul de Vries, representing Euroshareholders, suggested shareholders might pursue damages claims particularly targeting the Belgian government. The Belgian authorities contemplated annulling the decision based on procedural issues (such as a judge’s absence and unread ruling) or alternatively proceeding with selling a minority stake rather than the majority acquired in September. Eventually, the government decided against annulment and aimed to expedite the sale of its 49.9% share in Fortis Bank to BNP Paribas within a week. Meanwhile, the Dutch Ministry of Finance confirmed that under Dutch law, the sale was final and unaffected by the Belgian court’s ruling.

According to De Standaard, this judgment primarily opens avenues for renegotiation; although shareholder opposition might challenge sales, reversing them would likely require additional judicial rulings. Modrikamen called for calm and negotiation among stakeholders, emphasizing that approval from Dutch shareholders might still be necessary for their portion of the sale. Reports indicated he sought an extra €6 billion from the Dutch government.

At Fortis's request, the CBFA suspended trading of Fortis shares indefinitely. Fortis Bank CEO Dierckx reassured clients by emphasizing Fortis Bank’s strong solvency position, predominant Belgian government ownership, and partnership with BNP Paribas as stabilizing influences. No unusual withdrawal activity followed.

The Belgian government reportedly experienced alarm but remained committed to swiftly selling Fortis Bank to BNP Paribas. It pursued annulment of the ruling while preparing legal challenges based on procedural grounds and arguments related to third-party status. Officials feared losing leverage in negotiations if the ruling stood firm.

Shareholder meetings were arranged for December 19: Fortis shareholders were to decide on whether to continue Fortis Group operations; BNP Paribas shareholders needed to approve share issuance financing the acquisition—now uncertain due to court decisions requiring Fortis shareholder consent. The Fortis board was instructed by the court to modify meeting agendas accordingly, leading to legal complexities.

On December 15, Fortis announced it would comply with court orders by adjusting meeting agendas and retaining ownership of Fortis Insurance Belgium but refraining from acquiring 66% of structured credit portfolios. BNP Paribas shares declined by 10% amid doubts surrounding the acquisition.

That evening, Belgium’s cabinet convened with BNP Paribas representative Baudouin Prot and resolved to proceed with the sale; FPIM planned efforts to annul the deal while the government pursued a 'third party' procedure alongside selling its minority stake pending approval.

On December 16, media revealed that one judge had been absent during issuance of the ruling amid allegations of political affiliations; formal complaints regarding judicial pressure were promptly dismissed. Modrikamen altered client correspondence addresses individually, complicating governmental legal responses.

By December 17, Fortis updated its financial status: pro forma net equity decreased from €7.7 billion to €6.7 billion; Q3 results improved from a pro forma loss of €135 million to a profit of €152 million. Trading resumed but shares closed below opening levels; BNP Paribas shares dropped over 17%, impacted by exposure linked to the Madoff scandal.

Prime Minister Leterme admitted staff contacts with judiciary members but denied personal involvement; parliamentary inquiries followed concerning separation-of-powers issues. The Court of Cassation expressed regret over perceived governmental interference but found no definitive proof; formal judicial investigations commenced. Vice-Prime Minister Reynders called for political stability amid difficulties in selling Fortis.

ABN AMRO announced intentions to reverse an incomplete EU-mandated sale of business units to Deutsche Bank after Fortis incurred a €300 million loss; EU integration plans were paused pending clarification.

Dutch shareholders consolidated under FortisEffect threatened an €11 billion claim against the Dutch state following appeal outcomes.

BNP Paribas canceled its December 19 shareholder meeting intended for approving share issuance financing but reaffirmed commitment to acquisition despite scheduling disruptions.

Belgian media criticized alleged governmental interference causing delays in court rulings; Court of Cassation leadership acknowledged strong indications of influence without conclusive evidence. Parliamentary debates ensued; Justice Minister defended routine interactions between government officials and judiciary.

A letter from the procureur-generaal argued procedural irregularities invalidated the December 12 ruling due to informal hearing methods; this supported governmental annulment efforts.

Fortis shares surged nearly 20% on December 18 amid takeover uncertainties, closing above €1 per share.

Shareholder representatives united in calls for cooperative solutions aimed at maintaining Fortis as a Belgian entity and preserving employment.

On December 19, Court of Cassation’s chairman reported no conclusive evidence of interference but highlighted questionable conduct by Justice Minister and procureur-generaal during December 12 proceedings; Justice Minister resigned immediately. The entire Leterme cabinet stepped down on December 22 due to fallout from handling this affair.

The government obtained a court injunction requiring Modrikamen to retain his office address for client correspondence, reversing his prior changes that complicated legal procedures.

An interview with the spouse of the absent judge revealed her illness stemmed from workplace stress and threats within judiciary circles; he denied any breach of confidentiality or improper information disclosure.

On December 23, the High Council of Justice initiated a preliminary investigation into judicial conduct related to this case.

Shareholders' meeting on December 19

On December 19, a subsequent shareholders' meeting took place exclusively in Belgium. Originally scheduled to decide on Fortis's continuation if the December 2 meeting failed to secure majority approval, the agenda was revised after a court ruling. The revised agenda required the meeting first to determine whether this issue should be addressed. Notably, the session was led not by Fortis's interim chairman but by the co-chairs of the judiciary-appointed Committee.

Despite Fortis’s preference to postpone the decision, shareholders voted in favor of maintaining Fortis. The gathering was marked by disputes and mutual accusations. The board emphasized that options were limited and cautioned that failure to act could have driven Belgium toward bankruptcy, similar to situations in Iceland and Hungary. They further warned that renegotiations might not enhance shareholder value amid deteriorating financial markets.

Events following the Leterme I government collapse

After the December 19 meeting and the fall of the Leterme I administration, several significant occurrences unfolded:

• December 20: De Standaard reported that no additional legal steps would follow Modrikamen’s tactic of using a correspondence address amid the governmental turmoil.
• December 22: BNP Paribas CEO Baudouin Prot declared that no superior offer for Fortis Bank was anticipated, noting no value increase since October 10. Subsequently, BNP Paribas shares fell below €30, reflecting investor concerns about its capital strength.
• December 24: Fortis disclosed a €300 million loss tied to currency dealings within structured credit portfolios, anticipating adverse court rulings. Pro forma net equity dropped from €6.7 billion to €6.4 billion, and shares closed below €1 at €0.95.
• January 13: La Tribune reported that BNP Paribas might retract its bid for Fortis Insurance Belgium. Speculation about a Belgian government offer (€2.5–3 per share) caused share price surges but was officially denied. Fortis clarified that only Brussels-based shareholders could vote on sales under Belgian law; Euroshareholders contested this in Dutch courts.
• January 14: Fortis Bank ceased consumer credit services in Germany. Lawyer Modrikamen announced intentions to initiate lawsuits challenging September and October sales, aiming either to preserve Fortis as an independent Belgian bank or to seek compensation from governments and BNP Paribas.
• January 15: The Dutch government-owned Fortis MeesPierson rebranded itself as MeesPierson.
• January 20: A Dutch-language lawsuit parallel to Modrikamen’s French proceedings began, focusing exclusively on damage claims. The Belgian Finance Minister confirmed preparations for broad financial support measures and considered creating a "bad bank" for toxic assets, acknowledging risks of a downgrade from Belgium’s AA+ credit rating.
• January 21: Fortis CEO Karel De Boeck criticized the Dutch government for undervaluing Dutch assets and contemplated legal action pending expert committee conclusions.
• January 27: The court-appointed expert committee recommended shareholders approve sales as pragmatic solutions but suggested renegotiating CASHES toxic credit portfolios and proposed returning about one-quarter of Fortis Bank and Insurance Belgium shares to Fortis Holding.
• January 28: Following expert advice, Fortis resumed negotiations with the Belgian government and BNP Paribas; concurrently, Dutch shareholder association VEB announced plans to sue the Dutch government for damages.
• January 29: Renegotiations were anticipated to conclude before the February shareholder meeting. Agreements included special insurance coverage for recent or outgoing board members and proposed pay cuts aligned with industry standards.
• January 30: Renegotiations concluded with temporary suspension of trading. Fortis declined returning a quarter stake in Fortis Bank, choosing instead to concentrate on insurance operations. The agreement preserved the status quo since December 12 but involved selling 10% of Fortis Insurance Belgium to BNP Paribas and acquiring approximately 30% of toxic credit portfolios under improved terms. Profits exceeding €68 per BNP Paribas share would benefit Fortis rather than small shareholders directly. Despite improvements, Modrikamen’s clients planned opposition. The Belgian Finance Minister viewed the deal favorably for job security and Brussels's financial sector stability. All directors approved except Ping An’s representative holding a 5% stake.
• January 31: Analysts noted BNP Paribas resisted concessions, reducing its acquisition stake in Fortis Insurance Belgium from 100% to only 10%, thereby saving around €5 billion in cash expenditure. BNP Paribas shares rose above €30 following deal announcements.
• February 1: De Tijd assessed Fortis shares at €2.76 based on pro forma equity adjusted for asset changes since October; Ping An’s board member resigned without replacement.
• February 2: The Belgian government actively campaigned for shareholder endorsement of the January 30 agreement, warning that rejection would enforce October sales involving toxic credit portfolios only partly owned by shareholders.
• February 3: Finance Minister Reynders confirmed ongoing talks with China regarding Ping An’s €2 billion compensation claim but denied any preferential treatment; Modrikamen opposed governmental pressure on shareholders through an open letter.
• February 5: Shareholder uncertainty intensified ahead of the February 11 meeting; share prices fell below €1.40 amid confusion over voting consequences. Legal advisors clarified that voting against would reject October sales contracts but leave unresolved contracts intact, potentially causing liquidity problems as Fortis lacked funds to repurchase Fortis Bank from Belgium.
• February 6: Belgium assured China that Ping An’s vote would not impact damage claims under bilateral treaties; Modrikamen threatened legal challenges against Ping An’s voting rights. An independent agency warned that CASHES provisions remained ambiguous with unpredictable costs.
• February 7: BNP Paribas CEO Prot urged shareholders to act responsibly, assuring no layoffs at Fortis Bank post-acquisition. Reports indicated Fortis Bank prepared contingency plans (“Plan B”) should sales be rejected; liquidity needs were estimated at €30–40 billion daily with Belgian state support up to €150 billion. Parallel Dutch-language legal actions commenced alongside French proceedings.
• February 8: Ping An announced opposition to sales, likely securing majority against them given low expected shareholder turnout (~25%). The Belgian government threatened withdrawal of a critical €3 billion loan if sales were rejected, potentially forcing state ownership of both Fortis Bank and Insurance Belgium; shareholders were urged to accept the deal preserving insurance assets. The Prime Minister proposed renegotiating terms following Ping An's stance.
• February 9: A Dutch court rejected Euroshareholders' request for voting rights at Utrecht meetings. Analysts highlighted risks posed by Belgian government scare tactics potentially harming Fortis Bank’s reputation and increasing state borrowing costs while penalizing shareholders but safeguarding customers.
• February 10: Acting chairman Hessels warned that a “no” vote could trigger immediate bankruptcy due to a €2.3 billion deficit from October contracts imposed by Belgium; approving the January deal would provide clarity and government backing mitigating worst-case scenarios. Major shareholder groups VEB and employee initiative “Fortis Front” supported the deal; Modrikamen represented roughly 0.6% capital opposing it; industry leaders favored a standalone bank but lacked sufficient data on outcomes.
• February 11: Reports emerged that the Belgian government sought voting rights over newly issued shares linked to CASHES without actual voting power; legal counsel opposed this while the board engaged in extensive debate. Hessels anticipated additional payments from the Dutch government related to convertible bonds convertible into shares at fixed prices—complicated by changes in ownership involving Fortis Bank Nederland.

This timeframe was characterized by intense shareholder negotiations, multiple legal disputes, and strategic repositioning aimed at stabilizing Fortis’s core insurance operations while managing toxic assets amid governmental interventions during financial crisis pressures.

Shareholders Meetings on February 11 and 13

The agenda for the shareholders meetings scheduled on February 11 and 13 was published in the Belgian Official Journal on January 16. At the Brussels meeting on February 11, shareholders were asked to either endorse or reject three major decisions:

• the October 3 transfer of assets to Dutch parties
• the October 10 sale of the remaining 50% stake in Fortis Bank to the Belgian government
• transactions involving BNP Paribas, including Fortis’s divestiture of Fortis Insurance Belgium and the Belgian government’s sale of a 75% share in Fortis Bank

Shareholders also voted on changes to the Board of Directors, with particular attention on the nomination of Georges Ugeux, backed by minority shareholders as a leader for Fortis’s recovery efforts. Meanwhile, the February 13 meeting in Utrecht concentrated on board elections and a proposed amendment to the Articles of Association; if less than half of the capital was represented, the latter proposal would be deferred.

The Shareholder Circular for February 11 was released on January 30, delayed due to ongoing renegotiations. It permitted shareholders to vote against the sales but clarified that binding agreements might restrict the effects of such votes. Fortis emphasized that it could not modify the meeting agenda.

An addendum issued on January 31 provided further details about the January 30 agreement. A committee of Belgian experts appointed by the court endorsed the renegotiated terms and urged shareholders to approve them. Fortis maintained that no agenda changes were necessary, interpreting a favorable vote as acceptance of the revised deal. A streamlined Q&A document was distributed on February 5.

Approximately 7,000 shareholders registered for attendance, with around 5,000 physically present—a record turnout in Belgium—accompanied by significant media coverage. The meeting opened under tense circumstances; one shareholder was removed shortly after commencement. With only 20.32% of capital represented (excluding non-voting shares held by Fortis Bank), a motion to grant voting rights to these shares was rejected by attendees and subsequently withdrawn by Fortis Bank. The atmosphere deteriorated as proceedings continued.

At 15:16, voting swiftly rejected the sales proposals: approval rates were 42.99% for the Dutch government sale and 49.74% for the Belgian government transaction. In response, three board nominees withdrew following these results. Jozef De Mey, Georges Ugeux, and Jan Zegering Hadders were elected to the board; however, Ugeux’s appointment required ratification at the February 13 meeting.

According to Het Financieele Dagblad, Dutch pension fund ABP—holding approximately 50 million shares—abstained from voting, expressing dissatisfaction with what it considered a low valuation for Fortis Bank and uncertainty about Fortis’s prospects should they oppose the sales.

The February 13 meeting saw limited attendance and proceeded without incident, confirming the three new board members. When it became evident that Ugeux would not be appointed chairman, he chose to resign.

Aftermath of the February 11 Meeting

In the wake of the February 11 meeting, principal stakeholders reiterated their positions, reassuring Fortis Bank clients that their interests remained secure. A core cabinet group convened for two hours but did not announce any decisions. BNP Paribas affirmed its commitment to honor existing contracts until they expire on February 28 and signaled intent to pursue acquisition opportunities for Fortis Bank if feasible. BNP Paribas attributed complications to Ping An, while others criticized government actions related to voting rights over 125 million non-voting shares held by Fortis Bank, which triggered protests. Pre-meeting assessments suggested a majority favored approving the deals; a modest concession from the government—such as capturing any appreciation in value on its remaining 25% stake in Fortis Bank—might have secured approval, yet this was opposed by officials. Analysts speculate this stance aimed at preempting potential BNP Paribas litigation by demonstrating exhaustive efforts had been made.

Opposition factions within Belgium’s parliament condemned the government’s handling as a complete failure, demanding either cabinet resignation or at minimum Finance Minister Reynders’s departure.

Fortis Bank CEO Dierckx reported robust operational performance with no immediate solvency or liquidity concerns. Despite one-time write-downs, underlying earnings for 2008 reached €1.2 billion, with expectations for normal annual profits near €1.7 billion going forward.

A pressing concern remains Fortis’s toxic credit portfolio. De Boeck argued that an existing contract effectively signals impending bankruptcy for Fortis, whereas newly appointed Ugeux maintained that this portfolio belongs to Fortis Bank and had only been segregated following the disputed sale to the Belgian government; therefore, short-term responsibility lies with the government while Fortis itself remains stable.

Developments Following the February 11 Meeting

On Thursday, February 12, Fortis shares reopened at €1.10, down from €1.32 recorded on Tuesday. The Belgian government scheduled discussions involving representatives from the Netherlands, France, Luxembourg, BNP Paribas, and Fortis, culminating in a joint press briefing by the Belgian and French Prime Ministers. In parliamentary sessions, the Prime Minister defended the administration’s involvement in the contentious vote concerning 125 million non-voting shares, attributing the initiative to Fortis Bank itself. Opposition factions called for the Finance Minister’s resignation. Meanwhile, Modrikamen secured a court decision permitting shareholder correspondence addresses to be individualized. A Dutch attorney filed for an injunction to suspend actions related to Fortis’s Dutch units pending contract renegotiations.

• On February 14, Standard & Poor's lowered Fortis Holding’s credit rating, complicating its access to financing.

• By February 17, the Belgian Prime Minister disclosed that the government was evaluating two alternatives for Fortis Bank: either acquisition by BNP Paribas or continued independent operation.

• On February 18, newly appointed chairman De Mey emphasized renegotiation efforts with both the Belgian government and BNP Paribas; board members consented to ongoing discussions with BNP Paribas.

• February 20 saw ABN-AMRO CEO Gerrit Zalm proposing a sale of Dutch Fortis units back to Fortis Bank to satisfy EU market share regulations, which provoked trade union protests over employee exclusion concerns.

• On February 23, Fortis dismantled its anti-takeover defense foundation.

• Reports on February 24 suggested that maintaining an independent Fortis Bank would result in 5,500 job cuts over three years, whereas a BNP Paribas acquisition would reduce jobs by approximately 3,000. Renegotiations persisted but were temporarily halted without reaching an agreement.

• The deadline for the BNP Paribas transaction was moved forward to February 27; revised terms included BNP Paribas acquiring a 25% stake in Fortis Insurance Belgium.

• On March 1, Belgium’s government indicated readiness to nationalize Fortis Bank if negotiations failed but remained hopeful for a successful deal.

• Justice Minister De Clerck declined on March 4 to overturn a December court ruling favoring shareholders; his predecessor resigned amid mounting pressure.

• On March 5, Fortis Bank reported Q4 losses exceeding €1 billion beyond forecasts, culminating in a total loss of €20 billion for fiscal year 2008.

• Negotiations concluded successfully on March 7 with an agreement resembling January’s terms; however, BNP Paribas agreed to finance Fortis Bank’s purchase of a 25% share in Fortis Insurance Belgium. Shareholder approval was scheduled for April.

• The government anticipated on March 10 that Fortis Bank might require up to €2 billion in additional capital during the year; Ping An had yet to endorse the deal.

• On March 13, five candidates were proposed for election to the board pending shareholder approval; simultaneously, Dutch shareholder group FortisEffect initiated legal proceedings against governments and Fortis entities.

• By March 15, Fortis forecasted a €22.5 billion loss for 2008 and announced suspension of dividend payments affecting CASHES and FRESH instruments; its memorandum of understanding with Ping An expired, enabling Ping An to divest its shares. The company also transitioned its website domain to www.holding.fortis.com.

• CEO De Boeck declared on March 16 that Fortis intended to concentrate exclusively on insurance operations generating €12 billion annually and planned rebranding within two years due to relinquishing rights to the Fortis name.

• Further negotiations concerning structured credit portfolios and financing arrangements were scheduled for March 20.

• On March 26, Fortis Bank Nederland reported an €18.5 billion loss in 2008 primarily due to ABN-AMRO write-offs but achieved operational profit excluding these impairments. The court identified inaccuracies in shareholder records maintained by Modrikamen. BNP Paribas denied rumors suggesting it held a controlling interest in Fortis.

• By March 31, Fortis confirmed a total loss of €28 billion for 2008; insurance operations posted a modest profit of €6 million. The Brussels court ruled that only shareholders registered as of October 14 were eligible to vote on the takeover at April meetings.

• Anticipating delays due to court decisions, Fortis expected on April 1 that shareholder meetings or takeover resolutions might be postponed.

• ASR Insurance (formerly Dutch Fortis insurance) reported a €640 million loss for 2008 on April 2. The vote on the takeover was rescheduled for April 28–29.

• On April 8, the European Commission announced an inquiry into potential unlawful state aid provided by the Dutch government related to its acquisition of parts of Fortis.

• Following an appeal on April 10, all Fortis shareholders regained voting rights concerning the BNP Paribas transaction; however, proposals to add the stand-alone option for Fortis Bank to the meeting agenda were rejected.

Meetings on April 28 and 29

Prior to the April 28 meeting, Modrikamen attempted to secure a court injunction to prevent 170 million shares—registered in the Cayman Islands and considered dubious—from being counted in the vote; however, the Court rejected this request. Approximately 3,000 shareholders gathered in Ghent on April 28, where Modrikamen’s address incited attendees to throw shoes and coins at the board. Although the meeting was temporarily suspended, disorder persisted upon its resumption. Ultimately, around 73% of participants approved the proposed sale. The subsequent meeting on April 29 in Utrecht was notably more orderly, with roughly 300 shareholders present who represented a greater capital stake than those at Ghent. The controversy regarding the 170 million shares resurfaced, yet this assembly endorsed the sale by an estimated 78%.

Events following the April 28 and 29 meetings

• On May 12, the European Union affirmed that the acquisition involving Belgium and Luxembourg adhered to EU regulatory standards.
• On May 13, BNP Paribas disclosed that Fortis Bank experienced a 10% decline in deposits over the preceding six months.
• On May 14, Fortis reported a first-quarter profit of €44 million. Subsequently published accounts revealed that after the initial September bailout, Hessels notified the Dutch government that Belgium had secured the Dutch insurance company as collateral. This information led the Dutch authorities to renegotiate terms, ultimately resulting in Fortis's dismantling.

Subsequent developments

On July 13, 2018, the Amsterdam Court of Appeal sanctioned a €1.3 billion collective settlement concerning claims filed by former Fortis (currently Ageas) shareholders under the Dutch Mass Claims Settlement Act (WCAM).

Later, on December 20, 2018, prosecutors dismissed charges against seven ex-directors due to a lack of sufficient proof that they knowingly provided shareholders with misleadingly optimistic information.

See also

• ABN Amro
• Ageas
• BNP Paribas Fortis
• Fortis Bank Nederland
• List of Belgian companies
• List of Dutch companies