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    EU extends funding guarantees to Dexia

    The European Commission has given the green light for Belgium and France to to extend guarantees to Dexia Bank, it announced on Friday.

    In 2012, Belgium, France and Luxembourg gave State guarantees to accompany the dismantling of Dexia. These guarantees run until the end of 2021.

    Through this mechanism, the three countries can guarantee a maximum of 85 billion euros.

    Last February, Belgium and France informed the Commission that they wished to extend the guarantees by ten years, to the end of 2031, in order to pursue the orderly resolution procedure of the bank. Luxembourg no longer participates.

    These guarantees are a legacy of the financial crisis. After a first bailout in 2008, the bank collapsed again in the autumn of 2011 following the debt crisis in Europe.

    The Leterme Government had then nationalized the Belgian Bank, which became the current Belfius, and the publicly traded company Dexia became a residual bank.

    The Brussels Times