1) ABN Amro entered takeover negotiations after the 2006 purchase of Italy's Banca Antonveneta SpA increased costs and bad loans rose in the U.S., Latin America and Taiwan.
2) First-quarter profit this year increased 31 percent, helped by a gain from the sale of its U.S. mortgage business.
3) It agreed to sell Chicago-based LaSalle Bank for $21 billion to Bank of America Corp, which was looking for a more significant presence in retail banking in Chicago.
4) Barclays Plc, Britain's third- largest bank, agreed to buy ABN Amro Holding NV for 67 billion euros ($91 billion) at 36.25 euros a share in the world's biggest-ever financial- services takeover. The offer amounts to 33 percent more than ABN Amro's closing price on March 16. Barclays plans to slash about 12,800 jobs of the combined workforce, to help reduce costs by 2.8 billion euros. The bank would move an additional 10,800 positions to “low-cost locations”.
5) ABN Amro may still receive a rival offer from Royal Bank of Scotland Group Plc, Santander Central Hispano SA and Fortis. This group may be able to pay 40 euros a share or more for ABN by eliminating more jobs and overlap than Barclays. They are considering a breakup of ABN Amro. Royal Bank is most interested in its LaSalle unit, its Asian division, and its investment bank. (ABN Amro's decision to sell LaSalle to Bank of America may thwart Royal Bank's plans). Santander would get the Latin American business and Italian holdings. Fortis may keep the Dutch operations as well as the private equity and private banking arms.
Faux pas in 2006, course correction in 2007. This appears to be reasonably prompt action that many businesses would sweep under the carpet of 'creative financial statements' for a while to cover up their miss-steps while the wounds fester into cancers.
[Click here for full story at: BLOOMBERG.COM]
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