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ING May Get Screwed Twice On Mortgage Valuations

It looks like the Dutch executive compensation crusade was designed to atone for more than tax renegade members of the royal family. European regulators, once concerned there wasn't going to be enough help to save major institutions, are now taking a close look at whether the Dutch government supplied too much help to hometown favorite ING. The bank received a €22 billion guarantee to backstop its US MBS portfolio. But while the amount may be significant, the European Commission's issue has more to do with how the government arrived at that figure.
In the midst of the credit crisis, when bids on MBS were tough to come by and even tougher for the seller to stomach, a structured finance advisory firm, Dynamic Credit, put the value of ING's portfolio at 90 cents on the dollar. That figure sounds a tad bit high to some in the European regulatory community who are now considering giving ING a slightly less sensational figure, which would do quite a number on the bank's capital base. The EC wants to make sure banks are operating on a level playing field and select firms don't receive preferential treatment. So European regulators don't want to get into a game of picking winners and losers. Too bad that sort of thinking wasn't around one year ago today.
ING's State Help At Risk [Forbes]