13 Oct 2009

Dutch central bank takes over DSB

1:42 pm on 13 October 2009

Dutch bank DSB has been taken over by the central bank in the Netherlands and is now likely to be liquidated.

The BBC reports there was a run on the bank after reports that it was insolvent.

Finance minister Wouter Bos said DSB's failure was "not caused by the credit crisis" but by bad management, blaming its policies and unclear communications.

DSB is the first Dutch lender to fail since the government rescued several banks last year. Many of its 2000 employees are expected to lose their jobs.

The government is to hold an independent investigation into the bank's policies.

The central bank said it had asked the Amsterdam District Court to put DSB under its curatorship "because of a large outflow of liquidity that brought the existence of DSB in danger in the short term".

Central bank president Nout Wellink, said the liquidation would result in big losses for its creditors.

He said about a sixth of the bank's total deposits had been withdrawn since 1 October.