April 5, 2012 / 11:35 AM / in 6 years

Fortis guilty of mismanagement before break-up - court

BRUSSELS, April 5 (Reuters) - Belgian bank Fortis was guilty of mismanagement before it was broken up at the height of the financial crisis, a Dutch court ruled on Thursday, helping clear the way for shareholders to seek damages from the company now known as Ageas.

The court said on Thursday that Fortis, one of Europe’s top banks before the crisis, was guilty of mismanagement in the way it disclosed its subprime portfolio in the months before it was broken up.

The case, one of about 15 that Ageas is facing, was brought by a group of disgruntled former Fortis shareholders who lost out in the financial crisis.

Fortis was carved up by the Dutch, Belgian and Luxembourg governments in October 2008 after an 11.2 billion euro ($14.7 billion) cash injection failed to stem the slide of its share price.

While the judgement against the company is an incremental development in Ageas’ complicated legal problems and does not mean that it will have to pay compensation, it does help clear the way for the shareholders to seek damages afterwards, analysts said.

Ageas declined to comment, saying it would issue a statement later on Thursday.

Ageas shares were down just over 3 percent by 1056 GMT to 1.5 euros, a low not seen since the end of January. Fortis stock was worth almost 30 euros at the start of 2007.

$1 = 0.7623 euros Reporting by Mark Potter

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