New leaders at French-Belgian bank Dexia

7th October 2008, Comments 0 comments

The French and Belgian governments chose a new CEO and chairman for Dexia Tuesday after bailing out the troubled bank.

7 October 2008   
BRUSSELS -- The Belgian and French governments agreed that former Belgian premier Jean-Luc Dehaene should become new chairman of troubled Dexia bank, with a BNP Paribas manager as CEO, Belgian leaders said Tuesday.
Joining Dehaene, who served as Belgian PM between 1992 and 1999, as Dexia CEO will be Frenchman Pierre Mariani, a 53-year-old senior BNP Paribas manager, Belgian Prime Minister Yves Leterme announced early Tuesday following an emergency cabinet meeting.
On Monday Leterme met in Paris with French President Nicolas Sarkozy to plan the future of the French-Belgian bank, whose shares fell dramatically.
"On the fundamentals of Dexia, there is nothing to fear, it's a temporary problem. We are determined to work together, the governments of Belgium and France, to deal with the problem", Sarkozy said in Paris.
Bank chairman Pierre Richard and chief executive officer Axel Miller were forced to leave as part of the conditions of a EUR 6.4 billion bailout package for Dexia, quickly arranged by the French, Belgian and Luxembourg governments the first week of October.
The purchase was agreed as Dexia's share price dropped sharply.
Mariani and Dehaene are candidates "of the highest order", said Leterme.
Mariani was French budget minister in the 1990s and is a former head of Sarkozy's office.
"It's a strong sign of confidence for the market", he added.
So far in 2008 Dexia shares lost nearly 60 percent of their value, including over 20 percent on Monday alone.
Dexia was founded in 1996 in a merger of France's Credit Local and Belgium's Credit Communal. While it specialises in local government finance, it also has 5.5 million individual clients in Belgium, Luxembourg, Slovakia and Turkey.
The Dexia appointments came after BNP Paribas purchased a large part of troubled bank Fortis, with the Belgian and Luxembourg governments as minority shareholders, in another bailout package.

[AFP / Expatica]

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