Page last updated at 07:45 GMT, Monday, 4 August 2008 08:45 UK

'Difficult' times for Fortis bank

Jean-Paul Votron, former Fortis chief executive
Former chief Jean-Paul Votron left the bank last month

Belgian-Dutch bank Fortis has admitted it is facing "difficult" times after its half-yearly profits fell by 40%.

Profits for the first six months fell by 41% to 1.6bn euros ($2.4bn; 1.2bn) against a year ago, with second quarter profits nearly halved to 830m euros.

It blamed the drop on credit market turmoil and higher bad loan charges.

The bank lost its chief executive last month after Jean-Paul Votron stepped down amid criticism of his handling of problems related to the credit crisis.

His plan to raise cash to improve the bank's balance sheet, including a reduction in the shareholder dividend, met with an investor backlash.

In a statement, Fortis said its performance in the first half of 2008 must be seen in the light of a "very strong" performance in the same period last year.

But it stressed that the current market environment "was becoming more difficult".

Profits from the firm's banking business fell by 24% compared with last year, but its insurance arm fared better with returns rising by 8%.

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