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President of the Dutch Central Bank Nout Wellink attends a news conference about the troubled DSB Bank in Amsterdam |
The bankruptcy of Dutch mortgage lender DSB Bank in October offers a chilling reminder of bank risk to increasingly complacent investors, creditors and depositors. In November, it confirmed that depositors’ money remained frozen and no advances would be provided in anticipation of payouts under the country’s deposit insurance scheme.
Other Dutch banks must pay for this and might now regret not finding ways of pressuring the bank to change its ways. Even Rabobank, the only large Benelux bank to come through the credit crisis without taking state capital and the only Dutch bank to continue issuing debt without a state guarantee, cannot escape this one unscathed.
As the largest bank in the Netherlands, with a 25% market share...
