Dutch Deficit to Widen 0.6 Points on SNS Reaal, Minister Says

The budget deficit of the Netherlands will widen in 2013 after the government decided to take SNS Reaal NV (SR) into state control at a cost of 3.7 billion euros ($5 billion), Finance Minister Jeroen Dijsselbloem said.

“This will lead to a worsening of the budget deficit” by 0.6 percentage points in 2013, Dijsselbloem said at a press conference in The Hague today. The Dutch government and the Dutch central bank said the nationalization of the bank will cost the state 2.2 billion euros in capital injections, 800 million euros to write off earlier aid and 700 million euros to separate SNS’s property-finance unit.

The government’s central planning agency CPB had forecast a budget deficit of 3.3 percent of gross domestic product this year. The government will decide in March on possible budget measures, Dijsselbloem said.

To contact the reporter on this story: Corina Ruhe in Amsterdam at cruhe@bloomberg.net

To contact the editor responsible for this story: James Ludden at jludden@bloomberg.net

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