NBB deputy says Fortis suits will not help shareholders

BRUSSELS (Reuters) - The deputy chief of Belgium's central bank warned shareholders challenging the state-led break up of troubled financial group Fortis that there was nothing more Belgium could do or could have done.

"I think you are dreaming if you think the deal can be undone and that Fortis can continue on its own. It is totally unrealistic," Luc Coene told Belgian broadcaster VRT on Saturday.

"It would be a disaster if the deal were reversed. Fortis is not capable of surviving in the current difficult market conditions," he continued.

Fortis was carved up by the Dutch, Belgian and Luxembourg governments this month with BNP Paribas buying 75 percent of the Belgian operations after an 11.2 billion euro (8.9 billion pound) cash injection failed to calm investor concerns.

Belgium reassured Fortis depositors and gave some confidence to staff at the nation's largest private sector employer.

However, shareholders have seen Fortis stock drop from almost 30 euros in April 2007, before their ill-fated partial purchase of Dutch ABN AMRO, to less than 1 euro now.

Angry shareholders have argued the break-up of the group required their approval and a number have launched or threatened to launch legal challenges in the Netherlands and Belgium -- in the latter against the state's deal with BNP.

Coene said that BNP had been the only interested party and the government had turned down its initial offer. Nationalisation, he argued, had never been a realistic option.

"For the state it was hardly an option to take over a bank whose management had lost all credibility in the financial markets and which was literally going down," he said. "You don't solve the problems through nationalisation."