EU: In Contact With Dutch Authorities on SNS to Ensure Compliance with State Aid Rules
02/01/2013| 07:06am US/Eastern
BRUSSELS--The European Commission is in contact with Dutch authorities over the nationalization of troubled banking and insurance company SNS Reaal NV (>> SNS REAAL) to ensure European Union state aid rules are not breached, a spokesman said Friday.
"We are in contact with the Dutch authorities to ensure compliance with EU state aid rules," said Antoine Colombani, spokesman for European Competition Commissioner Joaquin Almunia. "We expect the public support granted to SNS to be notified to the commission."
Asked if the commission would factor into its state-aid assessment the fact that two leading Dutch banks have now been nationalized, Mr. Colombani said authorities always "look at the impact on competition" of state aid and make "sure that in the restructuring plans any distortions to competition are compensated."
A second spokesman, Simon O' Connor, said it is up to EU statistics agency, Eurostat, to decide how the nationalization affects the Dutch government's budget deficit and overall debt level.
"It's up to Eurostat to analyze whether the costs of recapitalization of financial institutions are considered debt increasing or not," Mr. O' Connor said.
Eurostat is currently looking at a similar case concerning the recent French and Belgian capital injection into Dexia.
The Dutch government said Friday will inject EUR2.2 billion of new capital in the company, write off EUR800 million from an earlier bailout and will write down EUR700 million on the value of SNS Reaal's property loans, Finance Minister Jeroen Dijsselbloem told a news conference.
Write to Laurence Norman at Laurence.email@example.com
Corrections & Amplifications
This article was corrected at 12:39 GMT to fix the figure the Dutch state will inject in SNS Reaal in the final paragraph. The government will inject EUR2.2 billion of new capital in the company, write off EUR800 million from an earlier bailout and will write down EUR700 million on the value of SNS Reaal's property loans.