The directors of Fortis NV, one of Europe's biggest banks, replaced its chief executive after the bank suspended dividends and took other unpopular measures to shore up its cash reserves.
The board of directors of the Belgian-Dutch bank said Friday that Jean-Paul Votron will leave his job after four years "by mutual agreement in the interest of the group."
Herman Verwilst, Votron's deputy and the chief operating officer, was named interim CEO while the bank looked for a permanent replacement, both inside and outside the company, said a statement following a board meeting in Brussels.
The announcement was delayed until after markets closed, but shares fell 4.2 percent Friday to euro9.45 (US$14.96) on the Euronext exchange.
The board meeting was called hastily in response to shareholder anger at a plan announced last month to boost reserves by euro8.3 billion (US$13.14 billion).
Under the plan, Fortis said it would issue euro1.5 billion (US$2.4 billion) worth of new shares and suspend the payment of a euro1.3 billion (US$2.06 billion) dividend for the first half of in 2008. The full year dividend will be paid in shares, further preserving capital _ but diluting the stock.
Fortis shares have shed roughly half their value since it joined a three-bank consortium last year, led by the Royal Bank of Scotland, that acquired Holland's largest bank, ABN Amro. The euro70 billion (US$111 billion) deal was the largest takeover in banking history.
Fortis' share of the package was worth euro24 billion (US$38 billion). The acquisition came as all banks were reeling from the global credit crisis, and Fortis had to write down some euro6 billion (US$9.5 billion) in investments.
Because of the ABN Amro deal, Fortis was compelled to sell commercial banking activities in the Netherlands to meet European Union competition requirements. It said last month the terms of the sales were not as favorable as expected.
In the latest deal, the bank announced two days ago it had sold its hedge fund International Asset Management Ltd. to the fund's managers. The value of the sale was not announced. IAM controls euro2.7 billion (US$4.3 billion) in assets.
Votron came to Fortis in 2004 after starting his career in Unilever where he managed international sales, then moved to Citibank.
The statement by the board said it had supported Votron's moves to join the ABN-Amro takeover, and had backed the solvency plan announced last month.
Verwilst served for two years with the International Monetary Fund and was briefly in the Belgian parliament before joining private banking in 1992.
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