* Dexma sold for 380 mln euros
* Dexia says deal will cut its liquidity needs by 12 bln
* France, CDC, Dexia Credit Locale to take 31.7 pct stakes
* Deal aimed at easing municipal credit crunch in France
(Adds additional background, details)
By Julien Ponthus and Christian Plumb
PARIS, Feb 10 Bailed out bank Dexia
will sell control of its French municipal finance arm
to the French government and state banks for 380 million euros
($501 million) as part of a deal aimed at restoring the flow of
credit to the country's towns and cities.
But Dexia said the sale will result in a 1 billion euro
loss, in the latest blow for the bank which France, Belgium and
Luxembourg were forced to rescue last October. The agreement,
which Dexia said would cut its liquidity requirement by 12
billion euros, is the latest step in the group's dismantlement.
The government takeover is part of a bid to plug a funding
gap for French towns, cities and other public entities estimated
at between 10 billion and 12 billion euros which has emerged as
a potential headache for President Nicolas Sarkozy.
The rescue of Dexia Municipal Agency (Dexma) is part of a
two-track solution to that problem which also involves the
creation of a public bank that will be 65 percent controlled by
La Banque Postale and 35 percent by CDC.
Dexma, which will keep a primary role in financing the loans
granted by the public bank, will in turn be acquired by a
separate entity to be 31.7 percent controlled by France, and
state bank Caisse des Depots et Consignations (CDC) each and 4.9
percent by the country's postal bank, La Banque Postale.
Dexia's Dexia Credit Local (DCL) unit, which until this fall
was the No. 1 lender to French municipalities via financing
obtained by Dexma, will keep 32.7 percent of the unit.
CDC said in a separate statement that it is providing up to
12.5 billion euros in liquidity to the new bank, which should
begin extending new loans to French municipalities by June.
Earlier on Friday Prime Minister Francois Fillon announced
that the government would make 2 billion to 5 billion euros in
loans available through the CDC to ease the municipal financing
credit crunch, caused by Dexia's near collapse last fall.
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Further narrowing municipalities' borrowing options,
France's largest banks have been under increasing pressure to
trim their own balance sheets to meet tougher capital
requirements and as their own liquidity was squeezed.
Fillon said the government funds were being made available
as a stopgap measure before the creation of the CDC-Banque
Postale joint venture.
For Sarkozy, who faces an uphill re-election battle,
France's municipal funding crisis is one more potential problem
after the country lost its triple-A sovereign credit rating from
Standard and Poor's and grapples with near 10 percent
Dexma has 80 billion euros ($106 billion) in loans on its
books. Fears that some could prove toxic have made CDC officials
baulk at an earlier plan under which the state bank would have
taken a 65 percent stake, leading the French government itself
to intervene directly alongside it.
The effective nationalisation of Dexma -- CDC and Banque
Postale are controlled by the French state -- in some ways
brings Dexia's municipal lending arm back to its roots.
The lender was created in 1996 from the merger of Credit
Locale de France -- a former unit of the CDC which had been
privatized -- and Belgian bank Credit Communal de Belgique
While the disposal of the French municipal lending business
solves a key part of the Dexia puzzle, the bank is still trying
to sell other units such as its asset management business and
Turkish arm Denizbank.
($1 = 0.7582 euros)
(Additional reporting by Yann Le Guernigou, Matthieu Protard
and Ben Deighton; Writing by Elena Berton; Editing by