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Finance & Business

Banking

Belgium's government in crisis over Fortis

Banking

22/12/2008Belgium's government in crisis over Fortis

Remco de Jong explains Mr Leterme's predicament.

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Belgium's Prime Minister Yves Leterme has been accused of trying to influence a judge in the Fortis takeover case. On Thursday the opposition called for his resignation. A higher court, the Court of Cassation, is investigating the matter.

Prime Minister Yves Leterme of Belgium

After an eight-hour session on Thursday evening the cabinet decided that neither the prime minister nor any ministers would step down. Belgium's VRT public television is reporting that ministers were discussing the possible resignation of Mr Leterme, as well as Deputy Prime Minister Didier Reynders and Justice Minister Jo Vandeurzen over the affair. It has not been confirmed that all three were involved in the alleged pressurising of the judges.

A decision on the ministers' position has been postponed until publication of the Cassation Court report about the judicial procedure that led to the verdict in the Fortis case. The court will report on Friday.

So what happened?

A week ago the Court of Appeal in Brussels declared that the government's sale of the Fortis Bank to BNP Paribas of France should not have taken place without shareholders' consent. The sale of the state-owned bank has been frozen for 65 days. A senior official from Mr Leterme's office contacted court officials in an attempt to prevent the Court from reaching this decision. The Prime Minister has confirmed that there was one such contact.

Earlier on Thursday, parliament wanted to question Mr Leterme about his contact with judges in the case, but he failed to appear. The speaker of parliament had been sent a letter by the Court of Cassation, which contradicted the prime minister's earlier assurance that he had not tried to influence any judge.

Avoiding a new crisis

The parties in the governing coalition are not eager to break up the cabinet, which is made up of five parties: two Liberal, two Christian Democrat, and one Socialist. It took nine months to agree on a coalition programme, during which time Belgium was practically without a government. A new period of political uncertainty, particularly during a difficult time for the national economy, is something that many politicians in Brussels say they want to avoid.

Radio Netherlands

Photo: CharlesFred