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Tue, Mar 17, 2009 - Page 10 News List

World Business Quick Take



Fortis expects US$29bn loss

Belgian bank Fortis said on Sunday it “expects” to report a record loss of 22.5 billion euros (US$29 billion) for last year, when the world financial crisis drove it to be nationalized and sold off. “That means there is no room for the payment of a dividend at the moment,” Fortis Holding said in a statement. It said it would publish full results for last year on March 31. Fortis Holding was formed last year when the damage wrought by the US-born international credit crisis forced it to be split up, with the Belgian and Dutch states taking control of its operations in those two countries. Belgium has since been negotiating to sell Fortis’ Belgian operations to the French bank BNP Paribas.


Pension funds to sue RBS

British pension funds are to sue Royal Bank of Scotland (RBS) for compensation for “massive losses” incurred when the bank had to be bailed out and the share price collapsed, the Times reported yesterday. Two local government funds claim that RBS and former chief executive Fred Goodwin “falsely reassured” investors the bank was in good health when it was “effectively insolvent” because of bad loans, the Times said. RBS is 70 percent state-owned after taking £20 billion (US$28 billion) of government funds as it struggled to cope with the global financial crisis. Last month it posted Britain’s biggest ever corporate loss. The Times reported that the two funds had hired Cherie Blair, the lawyer wife of former British prime minister Tony Blair who works under the name Cherie Booth, to file the lawsuit in a New York court.


No need for bailout: HSBC

HSBC’s finance chief said the banking giant would not require a British government bailout even if economic conditions in Britain or the US worsen, the South China Morning Post said in a report yesterday. Douglas Flint, the chief financial officer of HSBC holdings, said the company’s recently announced rights issue would provide more than enough capital, the report said. “The US$17.7 billion we are raising seemed to be an amount that made us extremely robust in any set of circumstances we could foresee,” the Post quoted him as saying. Flint said HSBC would not have to follow Lloyds TSB and Royal Bank of Scotland into taxpayer-funded bailouts. “We are in a totally different position. We were one of the few banks in the world that were profitable last year. It is unthinkable,” he told the paper.


Bebo offers more languages

Social networking Web site Bebo yesterday announced the launch of five new European-language versions, its first major expansion outside the English-speaking world. Owned by America Online, Bebo claims to have more than 22 million users worldwide, almost half of them in Britain. Until now Bebo was available only in English and in Polish, compared with the 40 language versions offered by market leader Facebook. Users can now choose French, German, Italian, Spanish or Dutch. “We think there are lot of opportunities in the Western European market, both for user potential and for monetization,” Bebo international vice president Nicole Vanderbildt said. “International expansion is a key part of our growth strategy,” she said, adding that Bebo had “very ambitious plans” for the European market. Once a niche for teenagers and technophiles, social networking has exploded into the mainstream, with industry research suggesting more people logged on to membership community Web sites than e-mail services in December.

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