From the good people at Reuters: France and Belgium will guarantee the financing of stricken bank Dexia, finance ministers pledged on Tuesday as officials prepared a rescue designed to stop its troubles from worsening the euro zone crisis.
"We are going to take action concerning our banks, and the decision taken so far is to act with a guarantee," Belgian Finance Minister Didier Reynders said after a joint government statement that followed a 38 percent drop in the banks share price in early trading.
Key Belgian cabinet ministers will meet to discuss Dexia on Tuesday evening, a government spokesman told Reuters.
In France, talks on creating a new entity combining Dexia's local government lending arm with French state bank Caisse des Depots and Banque Postale are ongoing but likely to be finalized, a senator from French President Nicolas Sarkozy's centre-right party told Reuters. The French state does not expect to inject capital into this new entity, which would safeguard the financing of France's local governments and regional authorities, Senator Philippe Marini said in an interview.
Read more at http://www.cnbc.com/id/44766823
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