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Belgium agrees to buy Dexia subsidiary

10-11-2011 10:55 BJT

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BRUSSELS, Oct. 9 (Xinhua) --- France, Belgium and Luxembourg reached a deal on Sunday to split Dexia bank, which is entrapped in huge exposures in sovereign debt problems.

According to a joint statement announced after intensive talks among the three countries, the proposed solution will be submitted to the Dexia board, which may approve the plan.

But details of how much each nation should pay are yet to be disclosed.

In fact France and Belgium disagreed on price of Dexia's Belgian branch called Dexia Bank Belgium, including a retail network, which the Belgian government would like to take over but only agreed a minimum price.

It is estimated the offering price for the bank is between 3 billion euros (4.01 billion U.S. dollars) and 7.5 billion euros (10.03 billion U.S. dollars).

Belgian Finance Minister Didier Reynders said Sunday that Brussels did not exclude option of completely buying up the subsidiary.

"It is not our intention to stay forever. That doesn't mean that we will stay for three or six months," he said, adding "I don't exclude that in three or five years, maybe more, we will still be present."

France and Belgium also need to agree on share each government will cover in guarantees for a "bad bank" that will be responsible for high-risk assets of Dexia. France is said to want Belgium government to take a bigger share so as to preserve its AAA credit rating, which may not easily be achieved.

 

Editor:James |Source: CNTV

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