Van Dijkhuizen joined ABN in 2013 and helped in its initial public offering of shares last year.

Zalm, the former Dutch finance minister who took over ABN in 2009 after its nationalisation in the wake of the global financial crisis, announced in September his intention to step down.

ABN was nationalised together with the Dutch parts of the now defunct Fortis bank in 2008 as it hurtled toward a bankruptcy that would have threatened the Dutch banking sector. Its nationalisation cost taxpayers billions of euros.

In a statement, ABN said Van Dijkhuizen's appointment would be effective on approval by regulators, which it expects by mid February 2017.

Van Dijkhuizen held various posts at the Finance Ministry, eventually rising to the position of Treasurer General, before moving to the private sector as CFO of NIBC Bank from 2005-2013.

ABN said in a statement that Van Dijkhuizen, 61, would focus the bank on catering better to its clients, growing sustainably, and being "sensitive to society".

Due to public anger over the bail-outs of ABN and other Dutch financial services companies, bonuses in the Dutch banking sector have been capped at 20 percent of base pay, far more restrictive than the 100 percent cap elsewhere in the European Union.

Voters were outraged when the ABN board attempted to raise base salaries for managers in the run-up to its stock market listing in 2016 to compensate, and the idea was eventually scrapped.

Jeroen Dijsselbloem, the Dutch finance minister who personally signed off on Van Dijkhuizen’s appointment, said he had "proved himself as an outstanding banker over the past 11 years, and a fine manager with a strong societal antenna."

"He will now lead the bank to a new phase, in which the state will continue cutting its stake."

The bank said Van Dijkhuizen will be expected to deliver on targets set at the time of its IPO, when it advertised itself as a reliable dividend payer, with a strong position on the Dutch market albeit with limited growth opportunities.

Van Dijkhuizen must also create the conditions for the state to sell down its remaining 77 percent stake, the bank said.

(Reporting by Toby Sterling; Editing by Ruth Pitchford)

By Toby Sterling