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The Dutch operations of Fortis, Europe’s largest victim of the credit crisis, have been nationalised in a €16.8bn (£13bn) deal aimed to calm investors in the troubled banking and insurance group.

Fortis is Europe’s largest victim of the credit crisis Photo: AFP

The Netherlands government stepped in to take over the assets, including buying Fortis’ interest in ABN Amro - the Dutch investment bank it jointly acquired last year in a consortium with Royal Bank of Scotland and Banco Santander. Shares in Fortis have tumbled almost 70pc this year as fears mounted that it had overstretched itself through its €24bn participation in the ABN Amro transaction.

Yesterday’s deal replaces an agreement struck on Sunday by the Belgium, Dutch and Luxembourg governments to rescue Fortis by pumping €11.2bn into the Belgian-Dutch bank. Under that deal, they would have taken a 49pc stake in the bank’s operations within each of their borders.

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Tags: ABN Amro, Bank, Credit Crisis, credit crunch, Economy, Fortis, Government, Holland, mortgage crisis, Mortgages, Politics

The French premier, Francois Fillon, today warned that the world was “on the edge of the abyss” as his country moved into an official recession.

Fillon’s comments, blaming an “irresponsible” financial system, came as the Dutch government seized control of bancassurer Fortis’s Netherlands operations in a €16.8bn (£13.06bn) deal greed with the Belgian and Luxembourg authorities.

The effective nationalisation, forced upon the governments by the scale of the financial meltdown, includes Fortis’s interests in Dutch bank ABN Amro.

The shock decision came just days after the three governments injected €11.2bn into Fortis, Belgium’s biggest bank, to keep it afloat.

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Tags: ABN Amro, bailout, bank failure, Economy, EU, financial crisis, Fortis, France, Government, Meltdown, Nicolas Sarkozy, Politics, Recession, Silvio Berlusconi

LONDON/TOKYO (Reuters) - Soaring commodity costs are denting manufacturing activity in Asia and Europe and the outlook looks bleak as new orders drop off in the face of rising prices, surveys showed on Tuesday.

Manufacturing activity in the euro zone contracted in June for the first time in three years while business confidence in Asia’s largest export markets is buckling and output has likely contracted further in the United States.

Purchasing managers indices showed manufacturing activity in the euro zone fell to 49.2 in June, China saw its index fall to a near three-year low of 52.0 while in Britain it contracted at its sharpest rate since December 2001.

The 50.0 mark separates growth from contraction. Factories worldwide have struggled in the face of soaring raw material and energy costs — oil hit over $143 a barrel on Monday.

Meanwhile, the Bank of Japan’s tankan corporate index of big manufacturers’ sentiment dropped to plus 5, from 11 in March, showing their mood has not been darker since 2003.

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Tags: ABN Amro, China, Commodities, ECB, Germany, Inflation, Japan, Oil, Oil Prices, Recession, Singapore, U.K., U.S.

BRUSSELS / AMSTERDAM (DFT) - Fortis expects within the next few days to weeks to complete the collapse of the U.S. financial markets.

That explains the bank insurers interventions of the series Thursday at dealing with € 8 billion.

“We are ready at the last minute. It goes in the United States much worse than thought, “said Fortis chairman Maurice Lippens, who maintains that CEO Votron to live. Fortis expects bankruptcies of 6000 U.S. banks that now lack coverage. “But Citigroup, General Motors, there begins a complete meltdown in the U.S..”

Fortis took yesterday € 1.5 billion with a share issue. At the end of last year was the Belgian-Dutch group € 13 billion of new shares for the takeover of ABN Amro, for which it paid € 24 billion. Lippens bases its concern on interviews with bankers. “Two months ago we knew not so bad that it is in America. And it will be much worse. We have a thick mattress needed for the next eighteen months to come when we can bring to ABN Amro. ”

Two weeks ago reported the U.S. investment bank and adviser to Fortis Merrill Lynch certainly € 6.2 billion in additional capital was needed. The VEB yesterday demanded clarification of Fortis: CEO Jean-Paul Votron stopped in late april Fortis maintains that after the purchase of ABN Amro does not need on the capital market. In one year € 30 billion in market capitalization destroyed. After Votron last confession kelderde the share price by 19.4%, although yesterday climbed by 4.4% to € 10.65.

The massive unrest around the bank insurers, especially with our neighbours in Belgium as a bomb broken. While the fuss arose in the Netherlands to the limited financial world, it is with our neighbours the call of the day. Not only is the bank dominates the streetscape, but by the mokerslag for the Belgian volksaandeel are also hundreds of thousands of small investors hit hard.

All Belgian newspapers opened yesterday with real rampenkoppen, where the free fall of the bank insurers was wide coverage. ‘Fortis crashes, “” Rampdag for Fortis’ and’ Fortis loses 5.3 billion, “opened three leading newspapers.

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Tags: ABN Amro, bank failure, bankruptcy, Citigroup, crash, Depression, Dollar, Economy, Gold, Meltdown, Merrill Lynch, Recession, Silver, Stock Market, U.S., Wall Street