Chinese want Fortis money back
Insurance company Ping An, the largest shareholder in Fortis, is pressuring the Belgian government to pay compensation.2 December 2008
The Chinese insurance company Ping An, the largest shareholder in Fortis, is pressuring the Belgian government to pay compensation for the losses the company incurred due to the dismantlement of Fortis.
Ping An is the largest shareholder in Fortis. Due to the dismantlement of Fortis Ping An lost a lot of money: an estimated €1.8 billion. Ping An is putting pressure on the Belgian government to pay out compensation for the loss. The insurance company bases its claim on a trade treaty between China and Belgium.
The treaty states that when one of the two countries nationalises a company that has investments from foreign companies, the country is responsible for compensation.
The Dutch government bought out part of Fortis, effectively splitting the group into a Belgian and a Dutch branch (nationalising it at the same time), the Belgian government had pumped substantial money into Fortis but also decided to sell it to the French bank group BNP Paribas.
Just like the shareholders here, Ping An has also protested against the 'drastic operation' on earlier occasions and has highlighted the need for a general shareholders meeting.
Next week there are two Fortis shareholder meetings: one in Brussels and one in Utrecht (Netherlands). Ping An was unsuccessful in its endeavour to place the dismantlement of the Fortis Group on the agenda. Ping An is apparently now targeting the Belgian government to air grievances.
Chinese and Belgian officials met on Friday to discuss a solution to the problems. According to Reuters press agency, the Chinese government is threatening to suspend trade relations with Belgium.
Prime Minister Yves Leterme (Flemish Christian Democrat) would not comment extensively. He only said that he has been in contact with Ping An.