Dexia's former bank changes name to Belfius

BRUSSELS, March 1 Thu Mar 1, 2012 8:41am EST

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BRUSSELS, March 1 (Reuters) - The nationalised Belgian banking arm of crippled Franco-Belgian lender Dexia is to be called Belfius, it said on Thursday, as it sought to sever links with its former parent.

The unit was sold to the Belgian state for 4 billion euros ($5.35 billion) in October, when Dexia was bailed out for a second time in three years by France, Belgium and Luxembourg.

It said it had steadily cut its unsecured exposure to Dexia to 10 billion euros at the end of 2011 from 22.6 billion euros at the end of September.

That should fall to close to zero in the coming weeks, Chief Executive Jos Clijsters told a news conference.

Belfius suffered a loss of 1.37 billion euros last year, including a 1.31 billion hit from cutting the value of its Greek sovereign bond holding.

The bank drew its investment portfolio down to 41 billion euros from 51 billion euros a year earlier. Some 95 percent of it was still investment grade.

Its core Tier 1 capital ratio slipped to 11.8 percent from 13.6 percent at the end of 2010.

Clijsters said there was absolutely no need for a capital increase.

The bank suffered from some customers withdrawing funds as Dexia's liquidity problems mounted. However, Clijsters said the customer base of 4 million had broadly stabilised.

Belfius needs to present its strategic plan for approval to the European Commission in mid-April. ($1 = 0.748 Euros) (Reporting by Philip Blenkinsop; Editing by David Cowell)

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