Dutch to change bank debt rules

The Dutch government proposed to amend its tax rules to make it easier for lenders there to tap into Europe’s fastest-growing market for bank debt.

The Netherlands has trailed its European partners in deciding how to treat hybrid debt, which combines elements of equity and debt. As a result Dutch lenders, including ABN Amro, ING, and Rabobank, have stayed out of a market that allowed Deutsche Bank to raise about €3.3bn on May 20 after Germany decided how to tax the securities.

“Market conditions are currently favourable for issuing additional tier 1 capital. Clarity on fiscal treatments is of great importance to banks,” the government said in a legislative proposal sent to parliament yesterday. The new rule would allow Dutch lenders to issue this form of debt under conditions similar to those of their European peers.