Calamos Supports Greece
GreekReporter.comBusinessDexia Receives Injection On Grexit Fears

Dexia Receives Injection On Grexit Fears

Dexia, a Franco-Belgian bank, will receive another stimulus package from Belgium and France, due to heavy losses during the previous term. The extra funding is estimated at 5.5 billion euros ($7 billion) and is only one of many stimulus packages the bank has received since 2008 as a result of the global banking crisis.

Dexia, ranked 49th in the Fortune Global 500 and the biggest company in Belgium, faced severe losses in 2008. It applied for a bailout from the state, which resulted in a stimulus package of 6.4 billion euros ($8.5 billion) paid by Belgium, France and Luxembourg.

It also achieved state guarantees of 150 billion euros ($191 billion) in government bonds. In 2011, due to the rumors and widespread fear that Greece would not be able to repay it’s loans, the bank sold Greek bonds at a losing price, leading Brussels had to impose taxes on citizens because municipalities were partly owners of Dexia and they had invested the municipalities budgets to various government bonds, including Greek.

This time, Dexia faces a new challenge, as it prepares itself for the possibility of Greece leaving the Euro zone, the so-called “Grexit” During the third quarter of 2012 Dexia announced a loss of 1.23 billion euros ($1.5 billion) and a net loss of 2.4 billion euros ($3.1 billion) for the first nine months of 2012. Belgium will put up 53% of the 5.5 billion euros and France the rest. This third consecutive bail out creates a huge danger for both countries as they are already fighting to keep budget deficits under control.

(Source: BBC)

See all the latest news from Greece and the world at Greekreporter.com. Contact our newsroom to report an update or send your story, photos and videos. Follow GR on Google News and subscribe here to our daily email!



Related Posts