Flanders to absorb Holding's losses this year

5th December 2011, Comments 0 comments

The government of Flanders will be able to absorb the 265-million euro loss caused by the liquidation of the Municipal Holding without implementing additional savings this year, it was confirmed by the Flemish Budget Minister Philippe Muyters N-VA yesterday. The Municipal Holding, the biggest Belgian shareholder of the Dexia holding, chose voluntary liquidation after the three regions and Dexia Bank Belgium agreed that this was the best route to follow. According to their agreement the losses will be shared among all the relevant parties, with the regions assuming responsibility for 570 million and the government of Flanders 265 million euros. Of the 265 million, 225 million euros will cover the guarantees and 40 million short-term loans. The liquidation comes as a considerable blow for the Peeters administration, which had hoped to balance its budget this year. Early last month it managed to close the gap to some extent when 157.8 million euros were raised through a series of buffers and provisions. In response to questions on where the remaining 107.3 million euros will be found, the Muyters cabinet said that "in view of overcautious budgeting additional savings efforts would not be necessary".

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