Page last updated at 15:34 GMT, Monday, 12 October 2009 16:34 UK

Dutch central bank takes over DSB

Reporters wait outside the Dutch central bank
The central bank has taken over DSB and says it is likely to be liquidated

Dutch bank DSB has been taken over by the country's central bank and is now likely to be liquidated.

There had been a run on the bank after reports that it was insolvent.

The government 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 2,000 staff are expected to lose their jobs.

"This is about an individual, relatively small bank that brought itself into trouble by its policies, customers walking away, unclear communications, and all the uncertainty that was created because of that," said Mr Bos.

He added that the government was launching an independent investigation into the bank's policies.

It will look at the conduct of current and former board members, including former finance minister and current ABN Amro chief executive Gerrit Zalm.

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".

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

He added that about a sixth of the bank's total deposits had been withdrawn since 1 October.

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