Parliament has doubts about ING bailout

4th February 2009, Comments 0 comments

Parliament passes Finance Minister Wouter Bos's ING bailout plan with concerns about the risks involved.

THE HAGUE—Parliament still has doubts about a new bailout plan for banking and insurance company ING, but a majority nevertheless decided to give Finance Minister Wouter Bos the benefit of the doubt. The only party to express its unconditional support was Bos' own Labour Party.

The opposition argues that all risks will be borne by the taxpayers. Bos announced last week that the state would guarantee ING's US mortgages portfolio up to 80 percent. The finance minister is optimistic that US homeowners will continue making their mortgage payments.

The Christian Democrats (CDA) were markedly negative over a bailout for ING in a debate in the House of Representatives last night. In sharp contrast to their position on previous bailouts in the banking industry, CDA “acceded doubtfully” to the manner in which Bos is extending guarantees to American mortgages.

House of Representative members were displeased with the fact that details were revealed “three days after the agreement was made.” House member Frans de Nerée asked colleague Babberich if the Netherlands wasn’t slowly being led into sundry interventions in the banking sector.

According to the CDA the state has lost 4.1 billion on previous bailouts. “We’re extremely worried about the risks the state has taken upon itself this time around,” said De Nerée.

GroenLinks called it “impermissible” that Bos arranged the bailout without permission from the House. Kees Vendrik said that The Nederlandsche Bank is requiring per direct every bank and insurance company to re-evaluate its portfolios if their market value isn’t valid, according to the Ministry of Finance guidelines. In addition, Vendrik doesn’t understand why Bos hasn’t called for immediate adherence to bookkeeping laws, if they’re creating so many problems, as the Ministry’s indicated.

Radio Netherlands/NRC Handelsblad/Expatica

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