Brussels, Monday September 29th 2008

Euroshareholders, the pan-european organisation of shareholders’ associations, has taken notice of the outline of the Fortis rescue plan that was unveiled by the governments of Belgium, Luxembourg and the Netherlands last night and by Fortis early this morning.

Although Euroshareholders is – as a matter of principle – generally not in favour of interference by national governments, Fortis found itself in such a difficult position that direct action was necessary.

In combination with subprime exposure and the need for additional capital in relation to the takeover of ABN Amro, Fortis had in the last few weeks become victim of speculative pressure on its share price and rumours about its solvency.

The package that has been unveiled has the following positive effects:

• two substantial steps to improve the financial situation at Fortis: the investment of three national governments (Belgium, Luxembourg, Netherlands) of 11,2 billion euro and the announcement of the sale of ABN Amro.
• A relatively strong financial position after these steps, which will reduce the outflow of (savings) money and stop the (accelerating) decline of confidence in the bank.
• A valuation that – given current market conditions - respects the interests of existing Fortis shareholders. The investment of the national governments of 11,2 billion euro, values the bank interests of Fortis at 11,6 billion euro. This values the total of Fortis’ activities (including the insurance arm) at a higher level than the market capitalisation on Friday September 26th.
• Although the problems at Fortis can not be compared to those of the smaller US investment banks, the rescue plan leaves relatively more upside for existing shareholders to regain part of the losses they incurred over the last year.

Although government intervention was necessary at this moment in time, Euroshareholders hopes Fortis will in the medium term be able to decrease its dependence from the three governments mentioned.
 
Euroshareholders criticizes Fortis management that – because of poor communication – has contributed to the current problems of the company. The level of transparency on subprime-exposure, necessary write-downs and the financial position of Fortis has been insufficient. In this respect it is more than surprising that Fortis communicated on Friday that rumours about financial problems were false, which message was followed by a press conference later that day by interim CEO Verwilst, who was – only a few hours later – replaced by Mr Dierkx. There is also a discrepancy between the message of Friday and the extra write-down of 5 billion euro that has become necessary only 48 hours later.

Euroshareholders encourages European financial companies, central banks and security regulators to ensure that shareholders and investors in general are timely informed about the exposure to the subprime crisis, the necessity of write-downs and the financial situation.

Euroshareholders