Dexia Bank To Be Dismantled: Belgium, France And Luxembourg Decide

Dexia Bank Paris

Dexia Bank Paris

Dexia bank, the primary organization to suffer from the Eurozone Debt Crisis is being dismantled. The countries of Belgium, France and Luxembourg have released a joint statement in which they announce their mutual decision to dissolve the economically weak bank. The three involved parties have mentioned in their joint statement that after carefully evaluating the situation and consulting with several experts, all three have come to the conclusion that it is in everyone’s best interests to close down the bank. The three parties have furnished a solution proposal to the bank, on whom the onus to give a nod to the plan now lies.

The prime ministers of Belgium and France, Yves Leterme and Francois Fillon, recently met for lunch and discussed the possible solution and formally decide on the same. The meeting, held on Sunday, saw the two prime minister come to the agreed conclusion that the best move forward will be to dismantle the bank. The bank also needs severe financial aid and rescuing at the onset of the financial downturn in 2008.

Belgium and France have been shareholders in the bank ever since they contributed to rescuing the bank from the 2008 economic crisis. The prime ministers of the two countries met to discuss, amongst other aspects, the sale prices of the bank’s shares. The rates at which the shares of the Belgian retail banking branch, Dexia Bank Belgium, were also discussed. It has been reported earlier that Brussels was interested in purchasing the said branch.

The two prime ministers also met to discuss the guarantees that would support a supposed “bad bank”, which will continue to exist even after the Dexia bank is shut down. The “bad bank” will be allowed to continue as a holding place for high-risk assets. Bank directors are presently deciding on affairs and are yet to announce a response to the proposed dismantling.

French President Nicolas Sarkozy and German Chancellor Angela Merkel are currently meeting at a summit of French and German leaders. The summit, amidst other matters, also aims to create a common ground for the two political leaders to agree upon a common, mutually beneficial action plan which will allow them to re-capitalize different banks, even as the general public continues to lose faith in the banking system as fears of a severe European credit crunch do the rounds.

 

Richard Meryn
Richard Meryn, Associate Editor Industry Leaders Magazine (www.industryleadersmagazine.com)

Recent Posts

Should you sit out on the Rivian IPO?

Should you sit out on the Rivian IPO?

Amazon-backed EV maker Rivian has filed for its initial public offering. We find out if the Rivian IPO is worth the price or simply the next internet bubble.
21 hours ago
Bitcoin vs Gold: Here’s what experts have to say

Bitcoin vs Gold: Here’s what experts have to say

Many say that Bitcoin is the digital version of gold. While gold, like the dollar, is an outdated investment vehicle. We turned to experts to settle the bitcoin vs gold debate.
2 days ago
Best Pharma Stocks to Buy Right Now

Best Pharma Stocks to Buy Right Now

Industry Leaders has curated a brief list of the best pharmaceutical stocks you can buy right now, along with a list of pharma penny stocks that have the best potential to grow in
3 days ago
Why Is Squid Game So Popular?

Why Is Squid Game So Popular?

The Squid Game segments were watched by at least 132 million people in the first 23 days of the show on Netflix. Know what excited the viewers.
4 days ago
Amazon under Congressional scrutiny for pushing own products over others

Amazon under Congressional scrutiny for pushing own products over others

US judiciary Antitrust Committee writes a letter saying that Amazon is given time till November 1 to prove that it utilizes seller data available to create competing products and p
5 days ago
Porsche’s Taycan EV outsells ICE powered its 911 sports car

Porsche’s Taycan EV outsells ICE powered its 911 sports car

The Porsche Taycan EV has outsold the Porsche 911 sports car for the first time since it was introduced in 2019 by the German automaker.
5 days ago