The state shareholdings agency NLFI has recommended the sale of Volksbank via either an IPO or a takeover.

The Dutch state owns 100% of Volksbank after nationalising its predecessor SNS Reaal some 11 years ago when it ran into trouble with its property portfolio.

Finance minister Steven van Weyenberg said in a briefing to parliament that it will be up to the next government to decide what to do. A sale could be organised in one to three years, while an IPO would take at least seven, he said.

There have been calls from MPs to keep the bank in state hands or to rebuild it into a cooperative, but this, the NLFI says, would not be in the interests of its customers.

Volksbank, the fourth biggest Dutch financial services group, booked net profit of €431 million last year, 126% up on 2022. Earnings were driven by a 53% increase in net interest income, while higher charges for banking services added a further 25%, the bank said in February.

At the same time costs rose 23% due to an increase in staffing levels, pay rises and higher expenditure on anti-money laundering measures.

Volksbank, the parent bank of financial services companies  SNS, ASN and Regiobank, was told by the central bank last year it faced a fine for failing to check its clients properly for money laundering and links with terrorism.