News Summary: SNS looking to shore up books
News Summary: Dutch bank SNS Reaal looking at share issue; asset disposals, bondholder haircut
A man operates a smart phone outside a SNS bank Amsterdam, Netherlands, Monday Jan. 28, 2013. SNS Reaal NV, the troubled Dutch banking and insurance group, is looking to strengthen its capital reserves through strategies including a possible share issue. SNS, which has assets worth Euros 134 billion as of the end of June 2012, has been profitable in recent quarters. But its solvency has deteriorated as the Euros 9.8 billion property financing portfolio it bought from ABN Amro in 2006 has booked big losses on foreign investments and the Dutch commercial real estate market. (AP Photo/Peter Dejong)
CAPITAL BUFFERS: SNS Reaal NV, the troubled Dutch banking and insurance group, is looking to strengthen its capital buffers through strategies including a possible share issue or forcing some bondholders to take losses.
REAL ESTATE HIT: The company has been struggling after being hit about €2.3 billion ($3 billion) in losses on its foreign property investments and an increasingly weak Dutch commercial real estate market.
NEEDS CASH: SNS Reaal's capital reserves, designed to protect the group from economic and financial shocks, are below levels allowed under international banking law — and it still owes the Dutch state €750 million from a bailout it received in 2008. Analysts say SNS needs roughly €2 billion in capital to regain solvency.
