Today, the European Commission announced its approval, under EU State Aid rules, of the restructuring of Latvian bank, Parex, which was partially nationalized in November 2008.

Yesterday, the European Commission announced that it was termporarily approving, under E.U.

Introduction

Yesterday, Dexia S.A., a European bank that was rescued by the French and Belgian governments in September 2008, announced that it would no longer rely on state guarantees for future funding. All debt instruments issued prior to June 30, 2010 will remain guaranteed by the government pursuant to their terms.

The European Commission (EC) yesterday approved the restructuring plan of Northern Rock plc. The plan will split the company into two separate companies. The new Northern Rock plc will consist of a new savings and mortgage bank that will hold and service all customer savings accounts and some existing mortgage accounts.

The Commission has agreed a plan to split Northern Rock into two banks, a “good” and a “bad” one. The “good” bank will carry on the economic activities of Northern Rock and the “bad” one will be an asset management company that will run down the remaining business. The Commission found the UK Government had kept state aid to a minimum in planning the restructuring. Treasury is pleased with the approval, which it says will allow Northern Rock to return to the mortgage markets while the back book of mortgages is managed separately.

HM Treasury has issued a press release stating that the Government welcomes the European Commission's approval of the restructuring of the Royal Bank of Scotland and State Aid approval for the Asset Protection Scheme.

View Government welcomes approval of RBS restructuring, 14 December 2009  

On 13 November 2009, the Commission approved a restructuring plan for ING Groep NV under the EC State aid rules. ING is a Dutch financial institution, offering its services in over 40 countries. In October 2008, the Commission approved the liquidity guarantees of €12 billion offered by the Dutch government to support ING during the economic crisis.

The transition from 2009 to 2010 sees some significant legislative chapters closing, notably the Companies Act 2006, Rome I and II, the Banking Act 2009 and the Lisbon Treaty.

In parallel with the decision to allow the UK government to intervene in the liquidation of Bradford & Bingley, the European Commission has approved measures taken to facilitate the restructuring of Dunfermline Building Society. After the business encountered major financial difficulties, the UK Government intervened to facilitate an approved restructuring plan under which the building society’s impaired assets were split from its profitable business and put into administration.