European Commission Extends Anti-Trust Investigation On ING Groep

European Commission anti-trust regulators have decided to extend an on-going investigation concerning the illiquid asset back-up facility provided by the Dutch State to ING Groep NV.

"On the basis of the information provided so far, the commission has doubts as to the compatibility of the measure, in particular as regards valuation and burden sharing," said European Commission Spokesperson Jonathan Todd. He further emphasized "that the assets may be overvalued and that as a result the bank ING may enjoy an unfair competitive advantage compared to other banks."

The Commission has, however, extended its temporary clearance of the measure until the assessment of the measure is finalised.

In turn, ING announced that they were having "constructive talks" with the Dutch Government and the European Commission. ING Spokesperson Raymond Vermeulen, confirmed that the Commission"s clearance had been extended indefinitely.

The Dutch Finance Ministry declined comment on the possible duration of the extension, but reiterated that the two parties were having "constructive talks." Hey also did not mention whether the Dutch Government would continue to support ING, if the existing agreement was going to be changed.

ING Groep NV in January reached an agreement with the Dutch Government, which bought the right to cash flows on 80 per cent of ING"s 39 billion USD portfolio of U.S. mortgage loans, mostly consisting of Alt-A mortgages, for about 28 billion USD. Alt-A mortgages are a category of loans rated between prime and sub-prime. When the European Commission launched the investigation in March, a six-month deadline was set for completing it.