ABN Amro Steps Out of State Ownership After 15 Years
ABN Amro: A Historic Shift in Ownership
ABN Amro, a leading Dutch bank, has made a significant milestone in its corporate history. The government of the Netherlands now holds less than 50% of the bank’s shares, marking the first time in 15 years that ABN Amro cannot be classified as a state bank. This development is a remarkable shift from the government’s takeover in 2008, when the bank was on the brink of collapse. Robert Swaak, the bank’s CEO, views this as a positive development, indicating the substantial progress the bank has made since the government’s intervention.
The Journey from State Ownership
In 2008, ABN Amro found itself at the edge of bankruptcy following its acquisition by Fortis, a development that signaled the beginning of the global credit crisis. To prevent the bank’s downfall, the government stepped in on October 3, 2008, taking over the bank and bringing it under state control.
The government held full ownership of ABN Amro’s shares until 2015. That year, it began selling parts of the shares on the stock exchange, a move that gradually reduced the state’s shareholding. The recent dip below 50% marks the first time the government’s stake in the bank has fallen below half since the 2008 takeover.
Government’s Future Role in ABN Amro
Demissionary Minister Kaag of Finance announced in February that she planned to reduce the state’s interest to slightly below 50%. The exact percentage was not specified, and no plans have been revealed to significantly lower the state’s interest below the 50% mark.
With this change in shareholding, the government will no longer have the decisive say in decisions requiring approval from a majority of shareholders. Nevertheless, as the largest shareholder, the state expects ABN Amro to continue consulting it on major decisions, thereby ensuring a level of influence over the bank’s operations.
Significance of the Ownership Shift
The shift in ABN Amro’s ownership structure is a significant step in the government’s ongoing divestment plan. It comes after a five-year pause in the sale of the bank’s shares, with the government’s stake being reduced through the sale of depositary receipts.
This reduction in stake comes roughly a year after Sigrid Kaag, the Dutch Finance Minister, asked NLFI (the state entity responsible for holding the government’s stake in the bank) to evaluate the conditions under which the government’s holding could be decreased. The last significant sale before this week’s event was conducted in 2017 when the government sold off a 7% stake for approximately 1.5 billion to 1.6 billion dollars.
ABN Amro’s Evolving Role
ABN Amro’s evolution from a state bank to a publicly traded company has been a journey marked by a series of strategic sales and divestments. Following the financial crisis rescue, the government transformed ABN Amro from being one of the world’s largest banks into a lender primarily focused on serving domestic consumers.
ABN Amro made a return as a publicly traded company in November 2015 when the Dutch government sold off a 23% stake in an initial offering. The recent move indicates a continued effort by the Dutch government to reduce its involvement in commercial banking operations and further distance itself from its role as a majority shareholder since the 2008 financial crisis.
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