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Dexia saved by shareholder intervention

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Dexia saved by shareholder intervention

Dexia saved by shareholder intervention
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The troubled Franco-Belgian financial group, Dexia, has become the second euro-zone bank to be bailed out within 48 hours as the global credit crunch deepens. The world’s largest lender to local government is to receive a 6.4 billion euro capital boost from the French, Belgian and Luxembourg governments and other shareholders. Following lengthy talks, the Belgian government said it acted to defend Dexia as well as the security of the whole sector.

Belgium’s Finance Minister, Didier Reynders: “our main goal is to protect the savings, protect the account holders, in all of our banking institutions. That means to protect them 100%, meaning to not let anybody down.”

Shortly before the announcement, Dexia chairman Pierre Richard and chief executive Axel Miller resigned. The two quit after “drawing conclusions from the current financial crisis and its impact on the Dexia Group,” the company said in a statement. The Dexia rescue comes after the Belgian, Dutch and Luxembourg authorities agreed to part-nationalise Fortis, Belgium’s biggest bank, to save it from collapsing.