Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
Settings
Settings
Dynamic quotes 
OFFON

4-Traders Homepage  >  Equities  >  Euronext Bruxelles  >  Dexia SA    DEXI   BE0003796134

DEXIA SA (DEXI)

SummaryChartsNewsCalendarCompanyFinancials 
News SummaryMost relevantAll newsSector news 

EU: Bank Bailouts Pose Risk for Belgium

share with twitter share with LinkedIn share with facebook
share via e-mail
0
02/22/2013 | 11:30am CET

By Frances Robinson

BRUSSELS--Large guarantees for rescued banks, principally Dexia SA (>> DEXIA) will continue to pose a risk for heavily-indebted Belgium, the European Commission said when issuing its winter forecasts for the 27-nation bloc Friday.

"Large contingent liabilities (around 15% of GDP) stemming from guarantees given to financial institutions represent an additional risk," the European Union's executive arm said in the forecasts. "The impact of the recapitalisation of Dexia on the debt (0.8% of GDP) has been offset by the reimbursement of a loan by KBC NV (>> KBC)."

Debt is set to rise to 100.8% of gross domestic product (>> Goodrich Petroleum Corporation) in 2013 and 101.1% the year after. A decision by EU statistics body Eurostat on how to account for the 2.9 billion euros ($3.84 billion), which is 0.8% of GDP, recapitalization of Dexia late last year is still pending.

Belgium's budget balance is "projected to wobble around the 3% of GDP threshold," according to the forecasts. Belgium missed its target of 2.8% of GDP in 2012, coming in right on the EU limit of 3%. Still, as the country makes reforms, the commission reduced its deficit forecasts for the coming years.

In 2013, it forecasts 3.0% of GDP, compared with 3.4% in the last round of commission estimates. In 2014, the deficit is expected to rise to 3.2% of GDP--previously 3.5%--, despite the better growth outlook. This is partially due to relying on one-off measures, it said, with the new deterioration in 2014 "due to the rising trend of a number of expenditure categories, assuming no policy change."

The commission also said nominal wage growth will slow this year due to recent measures aimed at containing nominal wage dynamics. Belgium is one of the last countries in Europe to automatically increase salaries every year based on formulae linked to inflation--a practice criticized by National Bank of Belgium Governor Luc Coene earlier this week.

"These high wage costs are mainly based on the enormously high fiscal burden placed on labor in Belgium...in the end this is a political decision," he said. "There are a number of problems in this country which have to be tackled and one is the fiscal and parafiscal burden on labor...that is why we plead for a tax review."

Write to Frances Robinson at frances.robinson@dowjones.com

Stocks mentioned in the article : DEXIA, KBC, Goodrich Petroleum Corporation
share with twitter share with LinkedIn share with facebook
share via e-mail
0
Latest news on DEXIA SA
11/09 DEXIA : Delisting of Dexia SA/NV shares from Euronext Paris and Luxembourg Stock..
09/06 DEXIA : Decision of the Dutch Supreme Court in litigation involving Dexia Nederl..
05/20 HETA ASSET RESOLUTION AG : Agreement reached with the Republic of Austria
05/05 DEXIA : Close of the sale of Dexia SA shares resulting from the consolidation of..
04/07 DEXIA : Extension of the period for the sale of SA shares resulting from the con..
03/17 DEXIA : Wouter Devriendt proposed as successor to Karel De Boeck. His appointmen..
02/19 DEXIA : Group consolidated results 2015
01/29 DEXIA : Implementation of the Reverse Stock split of the Dexia : SA shares
01/28 DEXIA : Implementation of the Reverse Stock split of the SA shares
2015 DEXIA : simplifies its governance
More news
Sector news : Banks - NEC
12/02DJMorgan Stanley Toughens Pay Hurdles for Brokers
12/02 BARCLAYS : Deutsche Bank to pay $60 million to settle U.S. gold price-fixing cas..
12/02 Trump creates business advisory council stacked with CEOs
12/02DJDeutsche Bank to Cut Off Around 3,400 Clients
12/02DJCIT : Mnuchin, Tapped for Treasury Secretary, Leaves CIT and Sears Boards
More sector news : Banks - NEC
Advertisement
Chart DEXIA SA
Duration : Period :
Dexia SA Technical Analysis Chart | DEXI | BE0003796134 | 4-Traders
Full-screen chart
Income Statement Evolution
More Financials
Managers
NameTitle
Wouter Devriendt Chief Executive Officer & Executive Director
Robert de Metz Chairman
Christine Lensel-Martinat Chief Operating Officer, Head-Operations & IT
Véronique Hugues Chief Financial Officer & Executive Director
Koenraad van Loo Non-Executive Director
More about the company
Sector and Competitors
1st jan.Capitalization (M$)
DEXIA SA66,421.74%28
JPMORGAN CHASE & CO.23.58%291 986
WELLS FARGO & CO-1.43%269 095
INDUSTRIAL AND COML BA..-1.31%230 206
BANK OF AMERICA CORP25.49%214 530
CHINA CONSTRUCTION BAN..-3.29%187 660
More Results