This excerpt taken from the ABN 6-K filed Mar 30, 2009.
APPENDIX I - to the ABN AMRO Press Release on 2008 financial results
Update on separation
Separation activity in 2008
The sale of business unit Asset Management to Fortis Belgium was concluded on 1 April 2008. The sale of Banco Real and substantially all of the other businesses allocated to Santander was concluded in July 2008. The main disposal of an ABN AMRO business outside the Consortium was the sale of Banca Antonveneta to Banca Monte dei Paschi di Siena, which was concluded in May 2008. As a consequence, all results relating to Asset Management and Santander acquired businesses are classified as discontinued operations.
A number of businesses and client activities were transferred to RBS during 2008 and many businesses have been re-branded as RBS. For details of the RBS businesses and results description, reference is made to the 2008 RBS Annual Results documents as published on 26 February 2009 and the 2008 RBS Group Annual Report.
Other assets and liabilities shared in ownership by the Consortium have significantly decreased. They have either been sold or are economically allocated to a Consortium Member. In 2008, the majority of the Group Asset and Liability Management portfolios were allocated to individual Consortium Members. Group Functions have been scaled down in line with the separation of businesses.
As the transfer of businesses to Santander is substantially complete, ABN AMRO consists now of the remaining RBS acquired businesses, the Dutch State acquired businesses and some residual shared assets.
Business description and planned separation activity for 2009
RBS and the Dutch State have agreed that the Dutch State acquired businesses will be legally separated from the residual RBS acquired businesses into a new bank. A strategy is being developed in relation to the RBS acquired businesses that will remain in ABN AMRO. These businesses are principally part of the Global Banking & Markets, Global Transaction Services, Retail and Commercial Banking divisions of RBS Group.
It is intended that the Dutch State acquired businesses, which consist of the Dutch commercial and retail banking and international private clients business, will be transferred into a new legal entity under a separate banking license. The preparation of the license application including pro-forma financial information is in progress and is planned for submission to the Dutch Central Bank by the end of the 2nd quarter 2009.
In July 2008, to comply with conditions laid down by the European Commission for the integration of Fortis and ABN AMRO in the Netherlands, ABN AMRO agreed to sell some of its commercial banking activities in the Netherlands to Deutsche Bank, subject to a number of conditions including approval by the Dutch Central Bank. At the end of the stipulated period for completing this sale, 31 October 2008, these conditions had not been fulfilled and the sale did not proceed. ABN AMRO continues to review options for satisfying the requirements of the European Commission.
Governance until legal separation
Until the final legal separation, ABN AMRO will continue to be governed by its Managing Board and Supervisory Board and be regulated on a consolidated basis with capital ratios and liquidity measures and exposures of the Group being reported to and regulated by its supervisor, the Dutch Central Bank. Any future capital repatriations to individual Consortium Members are part of an overall capital plan agreed between all Consortium Members and are subject to regulatory approval.
Issued debt instrument allocation
As part of the separation process the Consortium Members have come to an agreement on the economic allocation of issued debt instruments within ABN AMRO to the individual Consortium Members’ acquired businesses. All Santander allocated instruments were transferred as part of the business transfers carried out in 2008.
A list of the allocation of the remaining issued debt instruments to the RBS and the Dutch State acquired businesses is published on the ABN AMRO website (www.abnamro.com).
An update on the transfer strategy and progress will be given as part of a first quarter trading update in May 2009. Furthermore, investors and customers will be kept informed directly or indirectly during the separation process.