Dutch central bank criticizes consortium's bid for ABN Amro

19 April 2007

The Dutch central bank has criticized the Royal Bank of Scotland-led consortium's bid to break up ABN Amro in what may prove a significant setback for the group.

A statement issued by DNB, which is imbued with the power to choose not to sanction takeovers of the country's biggest banks, said: "From a prudential point of view, a bid by the consortium would be very risky and complicated, in the execution and implementation of a transaction."

DNB's criticism comes after ABN Amro this week announced it was to enter exploratory talks with the consortium, which also includes Spanish Bank Santander and Belgian bank Fortis.

Since news broke of the lack of official support for the bid, shares in ABN Amro dipped 1.35 per cent.

ABN Amro is currently in negotiating with Barclays Bank, with the talks scheduled to end today after a two-day extension was granted this week.

Should Barclays' bid be accepted it would represent the largest-ever cross-territory transaction and create a company with a market capitalization of $80 billion.

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