Belgium rescues troubled bank amid ratings warning

The Belgian state has said it will pay €4 billion to purchase Dexia, a Franco-Belgian-Luxembourg bank with high exposure to Greek debt.

After a 14-hour board meeting on Sunday (9 October), Dexia's management agreed to the break-up and the state purchase of its largest division and the setting up of a so-called bad bank to deal with its troubled assets.

The Belgian government will guarantee 60 percent of those assets, relieving Dexia of more than €14 billion in terms of immediate...