The Antwerp asset manager Merit Capital loses its license as a brokerage firm. The Council of State has confirmed the withdrawal of that crucial permit.
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The National Bank decided on March 29 to revoke the license of Merit Capital, which manages 1.25 billion euros from 3,500 clients, with effect from April 5. The supervisory board’s executive committee did so after a lengthy procedure in which various shortcomings were identified that were insufficiently resolved.
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At the same time, the shareholders had failed to sell the company to a viable party. Plans to sell Merit Capital to oil group Netoil of the German Renell Bank were rejected by the National Bank.
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Profile Merit Capital
- Activity: Antwerp stock exchange house that manages 1.25 billion euros from 3,500 customers.
- Staff: 40 employees and branches in the five Flemish provinces.
- Gain: The company closed 2020 break-even after many loss years.
- Owners: British Duet Group (51%) and the Tops and De Backer families.
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After a proposal from Renell was rejected for the second time, the National Bank decided to pull the plug† But Merit Capital and its shareholders challenged that decision in the Council of State. At the same time, the Brussels president of the company court suspended the decision of the National Bank, allowing Merit Capital to continue working in recent weeks.
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However, the Council of State rejected Merit Capital’s objections on Tuesday. In an arrest the claim for annulment of the withdrawal of the license was dismissed. This seems to have sealed the asset manager’s fate.
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Concrete conversations
It remains to be seen how the National Bank will proceed with the file in order to gain insight into the immediate consequences for customers and staff. The regulator can push through the previously decided dismantling or still give Merit Capital the opportunity to complete the initiated transfer of the assets.
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The stock exchange had itself started a process to sell its assets. Concrete talks are underway with peers to take over customers and staff. The company said it could have an agreement on by mid-May ‘an orderly transfer’† Customers and staff would end up with an ‘established Belgian player’.
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