The European Commission approved an additional recapitalization package provided by the Dutch government in favor of ABN AMRO and Fortis Bank Nederland (FBN) as urgent rescue aid.

The European Union (EU)'s competition guardian said the additional aid of 6.9 billion euros (9.4 billion U.S. dollars) is necessary to finance the separation of ABN Amro from its mother company and the integration costs resulting from the merger between FBN and ABN Amro.

"This recapitalization package is a further step towards the restructuring of Fortis Bank Nederland and ABN Amro," said EU Competition Commissioner Neelie Kroes.

At the same time, the commission extended the scope of its in-depth investigation, opened in April 2009 into an aid package related to the purchase of FBN by the Dutch government, to include these additional measures.

It said the probe would allow the commission to assess in detail the combined effect of all the support measures in favor of FBN and ABN Amro and give interested parties an opportunity to comment on the additional measures.

The purchase by the Dutch government of FBN in October 2008 in the context of the rescue of Fortis, gave the Dutch government also control over the Dutch assets of ABN Amro, which Fortis had acquired in 2007. However, these assets had not yet been separated from the rest of ABN Amro.

The Dutch government recently announced a recapitalization package of 6.89 billion euros aimed at financing the separation costs of ABN and FBN, the costs of their integration and the settlement of certain obligations towards the other members of the ABN Amro buyers consortium.

The commission's preliminary assessment found that the measures seem necessary to allow the separation of the Dutch assets of ABN AMRO, but there was a need to ensure that the aid is not used to distort competition and to weaken competitors by adopting an aggressive pricing or acquisition policy.

"I sincerely hope that ABN Amro and Fortis will rapidly finalize their integration plans and resume their role as lender to the real economy in the Netherlands. The Commission will in the meantime make sure that competition is preserved," Kroes said.