By Terrance Rey
In the Netherlands, ABN AMRO Bank is commonly referred to as "The Bank." This nickname, which reflects its prominent role in the Dutch financial sector, underscores the central place ABN AMRO holds in the country’s financial landscape. Across the ocean in Curaçao and Sint Maarten, the Central Bank of Curaçao and Sint Maarten (CBCS) often calls itself "The Bank" in its press releases and on its website due to its indispensable role in the island economies. However, while "The Bank" in the Netherlands was nationalized during the financial crisis, the current rescue operation for ENNIA Caribe Leven N.V. (ECL) presents a very different picture. The irony is hard to miss.
During the 2008 financial crisis, ABN AMRO was on the brink of collapse. The Dutch government stepped in to prevent a bank run and further economic damage. The state bought shares in ABN AMRO, effectively nationalizing the bank. This gave the government control over the bank and allowed them to benefit from its profit potential.
After several years of restructuring, ABN AMRO stabilized and was partially re-listed on the stock exchange in 2015. The share sales brought the Dutch state a substantial profit, partially recouping the costs of the bailout. The nationalization not only protected the interests of Dutch taxpayers but also allowed the state to benefit from the bank's recovery.
While the Netherlands saved a financial institution through nationalization in 2008, the CBCS is taking a different approach to rescue ENNIA Caribe Leven in 2024. ENNIA, which has faced severe financial troubles for years, urgently needs a capital injection to resolve its solvency issues and provide security for its policyholders.
However, the proposed rescue does not include acquiring shares for the governments of Curaçao and Sint Maarten. The countries are being asked to provide funds to cover pension obligations without gaining ownership of ENNIA in return. Unlike the win-win scenario that the Netherlands created with ABN AMRO, Curaçao and Sint Maarten are left empty-handed, without any potential to earn a return on their investment or influence the management of ENNIA.
This is where the irony lies: while the Dutch government chose an approach for ABN AMRO that offered both financial stability and potential for profit, CBCS seems to miss this opportunity for Curaçao and Sint Maarten. Given the historical ties and influence of the Netherlands, one might expect that CBCS—where the Netherlands still wields significant influence—would choose a similar approach. Why is this not the case? Why aren’t Curaçao and Sint Maarten offered the same opportunity to become shareholders in ENNIA Caribe Leven as the Dutch government did with ABN AMRO?
A share in ENNIA Caribe Leven would not only offer security but also the chance for a return. It would give Curaçao and Sint Maarten more control over the future of the pension institution, enabling them to better protect the interests of their citizens. Yet, CBCS seems committed to a strategy where the burden is shared across the Caribbean countries without the benefits of ownership.
What we can learn from the nationalization of ABN AMRO is that ownership and financial involvement can go hand-in-hand with profit and influence. In the current situation with ENNIA, Curaçao and Sint Maarten have an opportunity to advocate for a strategy similar to that of the Netherlands. They could request a share in ENNIA Caribe Leven, ensuring that their taxpayers not only bear the burden but also benefit from potential long-term profits.
Shouldn’t CBCS do the same for ENNIA Caribe Leven as the Netherlands did for ABN AMRO? The irony is that the Central Bank that calls itself “The Bank” is offering the Caribbean countries a solution far removed from the model once followed in the Netherlands. It’s a paradox that raises questions about why the Dutch approach was good enough for “The Bank” in the Netherlands, but not for “The Bank” in Curaçao and Sint Maarten.
Only time will tell whether Curaçao and Sint Maarten will accept the current arrangement or have the courage to call CBCS out on this inconsistency. After all, if the Dutch approach was good enough for “The Bank” in the Netherlands, why should it not be good enough for “The Bank” in Curaçao and Sint Maarten?
