* Dexia board approves nationalisation of Belgian business
* Caisse des Depots to take most of Dexia's French municipal
* Dexia to dispose of DenizBank, RBC joint venture
* Dexia left with 75 bln euros bonds in run-off
* Contains 12 bln euros of euro zone periphery sovereign
By Philip Blenkinsop
BRUSSELS, Oct 20 Bailed-out financial group
Dexia cleared the way for its full dismantlement on
Thursday, with final board clearance for the nationalisation of
its Belgian banking business and details of the sale of its
French public financing arm.
Dexia was rescued by France, Belgium and Luxembourg this
month, receiving 90 billion euros ($124 billion) of state
guarantees and accepting that Belgium would take over its
operations there for 4 billion euros.
Dexia said French state bank Caisse des Depots and La Banque
Postale, France's post office bank, would take stakes of 65
percent and 5 percent respectively in its French public
financing arm, Dexia Municipal Agency.
Chief Executive Pierre Mariani told French business daily
Les Echos the takeover price was 380 million euros.
Caisse des Depots and La Banque Postale would also set up a
65:35 joint venture to provide loans to French local
authorities, refinanced through Dexia Municipal Agency.
The group said it had also started processes to dispose of
its 50 percent share in a joint venture with Royal Bank of
Canada -- RBC Dexia Investor Services -- as well as
Dexia Asset Management and its fast-growing Turkish operation,
Mariani told Les Echos at least four credible buyers had
Qatar National Bank , the Gulf state's largest
lender, is eyeing DenizBank in a deal potentially worth up to $6
Another Qatari investment group, belonging to members of the
al-Thani royal family, is set to take over Dexia's Banque
Internationale Luxembourg (BIL), in a deal Luxembourg's finance
minister Luc Frieden said was expected to be finalised this
Dirk Peeters, analyst at KBC Securities, said the
cherry-picking of Dexia was continuing and that this would
eventually lead to its conversion into a fixed-income hedge
Dexia said its bonds portfolio in run-off totalled 75.5
billion euros, some 20 billion lower than at the end of June,
and that it now held 12.2 billion euros of sovereign debt from
Greece, Italy, Ireland, Portugal and Spain, from 20.9 billion
Its Greek holding had fallen to 2.1 billion euros from 3.8
Mariani said the debt portfolio should shrink to 40-50
billion euros by mid-2013.
Dexia said the disposal of its Belgian arm would reduce the
size of its balance sheet by 144 billion euros and that it would
use the proceeds to repay loans from Dexia Bank Belgium.
The agreement with Caisse de Depots and La Banque Postale
would subtract a further 65 billion euros from the balance
sheet, which totalled 518 billion euros at the end of June.
As well as its bond portfolio, Dexia would also retain
public financing units Crediop of Italy, Sabadell of Spain, a
similar business in Germany and some French operations.