* Planning talks with French partners on Thursday
* Dexia Belgium could be nationalised - Belgian PM
* "Exaggerated" to think French rating to be hit - Noyer
* Some depositors withdraw funds, but no sign of bank run
* Dexia customer helpline "overloaded"
* Shares up around 2 pct (Adds board meeting on break-up)
By Lionel Laurent and Philip Blenkinsop
PARIS/BRUSSELS, Oct 5 (Reuters) - Worried customers withdrew funds and overloaded the telephone helpline of Franco-Belgian bank Dexia (DEXI.BR) on Wednesday ahead of a crucial weekend board meeting to approve a rescue plan and stop its troubles from deepening the euro zone debt crisis.
Dexia's board is due to meet in Paris on Saturday to vote on a break-up plan for the lender, two sources familiar with the matter told Reuters on Wednesday.
Belgium and France are expecting to finalise the rescue by Thursday so the board can vote. There have been some disagreements over details of the plan as the two countries have tried to defend their respective national interests, one of the sources said.
The source said that Dexia's board may have to choose between "a French and a Belgian option" on Saturday if the two sides cannot come to terms.
"These are still open discussions, rest assured (all of Dexia's assets) everything will be sold eventually," the source said.
Dexia is in need of support for a second time in three years because of its exposure to Greek debt and trouble accessing wholesale funds.
One French politician has already expressed concern that the problems facing Dexia, a key player in municipal funding, might contaminate other banks and hit already tight financing for local authorities.
"We have had some customers taking money out, but it has been limited," a Dexia spokeswoman said. "We have faced many questions, and we have been explaining the situation a lot."
Dexia's telephone helpline began with a warning that its system was 'overloaded'. Otherwise, there were no obvious signs of panic or queues at Dexia's branches in Brussels.
"It doesn't worry me, I know it will be okay," said Mora Ba, a 39-year-old plumber, coming out of a branch in Brussels.
Claude Bartolone, a lawmaker for the Seine Saint-Denis department north of Paris, said details were urgently needed.
"It would be unacceptable to contaminate the Banque Postale and especially the Caisse des Depots, given the trust that exists between it and local governments," he said.
He added the rescue of Dexia had come at a very difficult time for the local authority funding, with tougher capital rules and market volatility tightening the screws for banks.
Maurice Vincent, the mayor of St Etienne, said Dexia's market share for local finance in France had dropped to 10 percent from 20 percent in recent months, although they still held around half of all loans to municipalities.
In Belgium, the 589 cities, towns and districts which jointly hold a 14.1 percent stake could face an end to dividends and a capital loss that could bring down their holding cooperative.
"We are already in a tough situation," said Michel De Herde, finance chief at Schaerbeek commune in Brussels. "If things go wrong it would also not be good for the public finances of Belgium as a whole," he said.
France, Belgium pledge aid for ailing Dexia [ID:nL5E7L40WD]
DEALTALK-Govts to let curtain fall on Dexia [ID:nL5E7L42AL]
France eyes mayor-friendly way out [ID:nL5E7L43C4]
FACTBOX-History repeating for Dexia [ID:nL5E7L43RA]
THE BIGGER PICTURE
Europe wakes up to need for bank aid plan [ID:nL5E7L52CO]
EU prepares rescues amid Greece doubts [ID:nL5E7L419D]
Dexia: a one-off or a warning shot? [ID:nL5E7L43MC]
Pressure grows on EU to help ailing banks [ID:nL5E7L4136]
Banks take Greek bailout defence to brink [ID:nL5E7L42CS]
Dexia's shares hit an all-time low on Tuesday but recovered some ground on Wednesday as the Franco-Belgian rescue appeared to take shape and as signs that euro zone finance ministers are exploring ways to recapitalise banks boosted markets.
"I think that tomorrow a solution should be found," France's finance minister, Francois Baroin, told RTL radio.
Belgium's Prime Minister Yves Leterme said in a television interview that discussions would start on Thursday, and a decision should be made in days rather than weeks.
"I believe it's more a question of days than a question of weeks," he said when asked when a decision was expected during an interview with Belgian French-language television station RTBF on Wednesday.
Belgian newspaper De Tijd reported customers had gone into Belgian branches to withdraw 300 million euros ($398 million) from Dexia accounts. This excluded online transactions. Dexia in Belgium holds some 80 billion euros of deposits.
Belgium's prime minister and finance minister have said Dexia savings were safe, with a government guarantee of 100,000 euros per account holder.
"Dexia clients saved" was the headline on top-selling Flemish newspaper Het Laatste Nieuws.
Three years after Fortis was broken apart by Belgium, the Netherlands and France's BNP Paribas (BNPP.PA), Belgians are aware that a bank can go under, destroying shareholder value, but without touching customer deposits.
BELGIUM'S BORROWING COSTS RISE
Under the rescue, the lender to thousands of French and Belgian towns will see its French municipal funding arm broken off and combined with French state bank Caisse des Depots and Banque Postale, the banking arm of France's post office.
Belgium's caretaker prime minister, Yves Leterme, said nationalisation of the banking activities, including a large retail operation, was being considered.
Leterme also said guarantees Belgium planned to provide to Dexia did not represent a risk for the country and, while nationalisation would hit public sector debt, the increase would be "quite limited."
However, Belgian government bonds underperformed their German counterparts partly due to concerns that Belgium would face a hefty bill for Dexia. The 10-year yield spread rose to 2.22 percent, a three-week high.
Bank of France Governor Christian Noyer said speculation that support of Dexia would threaten France's AAA credit rating were "exaggerated and inexact."
French banks, he said, were generally in good health and the central banks of Belgium and France would ensure Dexia had enough liquidity. "We will loan Dexia as much as it needs," Noyer told Europe 1 radio.
Dexia shares were 2 percent higher in late trading, albeit 29 percent down this week and 58 percent lower in the year to date. In an online poll in De Tijd asking if investors would end up with anything after the rescue, 75 percent of respondents answered 'no'.
French banks also rallied. Credit Agricole (CAGR.PA) shares were among the strongest in the FTSEurofirst 300 index .FTEU3, up 7.8 percent. BNP Paribas shares were 6.2 percent stronger. ($1 = 0.753 euro) (Additional reporting by Sophie Sassard and Victoria Howley in London, Robert-Jan Bartunek, Ben Deighton in Brussels; Leigh Thomas and Alexandria Sage in Paris; Editing by Andrew Callus and David Cowell)