In accordance with IAS 28 Investments in Associates, the shareholding of Fortis in RFS Holdings is considered as an investment in an associate, representing an entity over which Fortis has significant influence. RFS Holdings is consolidated as a subsidiary by RBS because of its control over RFS holdings. The minority interest owned by Fortis in RFS Holdings is accounted for using the equity method. Under the equity method, the investment in RFS Holdings is initially recognised at cost and the carrying amount is increased or decreased to recognise Fortis’ share in the profit or loss and net assets of RFS Holdings after the date of acquisition.

On 10 October 2007, the Banks declared the Offer unconditional and effective settlement of the Offer took place on 17 October 2007. This date is identified, pursuant to IFRS 3 Business combinations, as the date of acquisition of control by RFS Holdings on ABN AMRO (with legal, accounting and tax effects) and thus as the date on which the balance sheet figures of ABN AMRO are recognised in the accounts of RFS Holdings.

According to IFRS 3, the acquired ABN AMRO businesses are accounted for using the purchase accounting method.

This process includes the identification and the fair value calculation of the assets and liabilities acquired by Fortis and the recognition and valuation of intangible assets. This process is executed in different stages. The stages include:

• review of the accounting policies as applied by ABN AMRO and recognition of difference with the accounting policies of Fortis
• preparation of the fair value accounting of the on-balance and off-balance sheet items of ABN AMRO at the date of acquisition
• recognition of intangible assets and their value and consequently the calculation of the goodwill paid
• accounting of the result of the business units of ABN AMRO acquired by Fortis for the period 17 October – 31 December 2007.

The review of the accounting policies, the preparation of the fair value of the balance sheet items, the recognition and measurement of the intangible assets and the calculation of the goodwill, as described below, are currently taking place and are planned to be finalised by the end of June 2008. Figures disclosed in relation to the recognition and valuation of ABN AMRO related assets and liabilities are therefore provisional.

The provisional identifiable assets and liabilities of the acquired ABN AMRO businesses and the part of Fortis in the shared assets, as well as the goodwill related to the acquisition, can be presented as follows:

At Fortis level, the acquisition cost and the goodwill amount are reduced with EUR 92 million due to the elimination (33.81%) of the gains realised on the exchange of the ABN AMRO shares previously held by Fortis entities.

There were no major measurement differences between the accounting principles applied by ABN AMRO and the accounting principles applied by Fortis and as such not resulting in significant adjustments of the carrying value of assets and liabilities.

Adjustments following to the application of fair value accounting on the on-balance and off-balance items of the acquired ABN AMRO businesses were mainly related to the mortgage portfolio, funding positions related to the asset & liability management, the property portfolio and the investments in associates.

Intangible assets include an amount of EUR 195 million relating to intangible assets previously accounted for by ABN AMRO. Additionally, an amount of EUR 2,880 million has been recognised in relation to the application of IFRS 3 Business combinations. At this moment, Fortis has initially recognised the following intangible assets according to IFRS 3: core deposits, core overdrafts, client relations and the brand name.

The value of a core deposit intangible asset arises from the deposit base of the acquired business being a source of funding at lower cost than wholesale or money market funding. The spread between the cost of deposit funding – i.e. the interest paid to customers – and the cost of wholesale funding represents the most significant component of value of the core deposit intangible.

The value of a core overdraft intangible asset arises primarily from future interest income that will be received on revolving loans throughout the length of a relationship with current account customers.

The value of the customer relationship intangible asset arises from future non-interest (i.e. fee & commission) income. These future benefits are not encompassed in the fair value of loans and receivable balances and are therefore recognised as a separate intangible asset.

As part of the transaction, Fortis also took ownership of the ABN AMRO brand and has valued it as an intangible asset.

The provisional purchase accounting applied on the assets and liabilities of the acquired ABN AMRO businesses and the part of Fortis in the shared assets, currently results in a goodwill of EUR 19.4 billion (EUR 24 billion acquisition price and EUR 4.6 billion net assets).

The net intangible assets to be deducted in the local regulatory solvency calculation, assuming full consolidation of the acquired ABN AMRO businesses, are currently valued at EUR 2.9 billion, subject to final determination.

In the Consortium and Shareholders’ Agreement (CSA), the partners guaranteed each other a minimum core equity to risk-weighted assets of at least 4.95% for the businesses acquired by the individual partners as of 31 December 2006. Based on the provisional figures and according to the CSA, Fortis is entitled to capital support of the Consortium partners. The capital support can be structured in the form of an exchange of capital relief transactions or a subscription to core equity instruments. A condition related to the capital support is the acceptance of these transactions or instruments as core equity by the home regulators. The capital support to Fortis, together with the anticipated impact of the EU Remedies, will lead to a transfer of around EUR 3 billion.

The acquired ABN AMRO businesses contributed EUR 179 million to the net profit attributable to shareholders of Fortis in 2007. The share of Fortis in the net assets of acquired ABN AMRO businesses as at 31 December 2007 was EUR 4,755 million. The income statement for the period 17 October to 31 December 2007 (76 days) for the acquired ABN AMRO businesses and the shared assets part of Fortis is as follows:

The following table provides further information on the total assets and liabilities of the acquired ABN AMRO businesses and the shared assets part of Fortis at year end 2007:

The net assets evolution between the opening balance (17 October 2007) and situation as at 31 December 2007 is explained by the following elements: