Dexia faces $3 billion loss

The Franco-Belgian bank Dexia has announced it will restructure and cut 3% of its staff after posting a €3 billion full-year loss.

Dexia Luxembourg

Dexia says it will close operations in Australia, eastern Europe, Mexico and Scandinavia and reduce business in the United Kingdom and the United States.

Dexia specialises in finance to local governments but also runs standard retail banking outlets in Belgium and France. It will cease proprietary trading as part of the restructuring.

Herman Van Rompuy was sworn in as PM

The Van Rompuy I Government is the new federal government of Belgium since 30 December 2008. It took office when the Flemish Christian democrat Herman Van Rompuy (CD&V) was sworn in as Prime Minister after the Leterme I government had fallen on 22 December 2008.

Herman Van Rompuy

On 19 December 2008, Yves Leterme offered the resignation of his government to King Albert after a crisis surrounding the sale of Fortis to BNP Paribas erupted.

Leterme, Jo Vandeurzen, and Didier Reynders were accused of violating the separation of powers by trying to influence the Court of Appeals and of exerting improper influence by the First Chairman of the Court of Cassation. Three days later the resignation was accepted by the king.

The Van Rompuy I government still needs to receive the confidence of the Chamber of Representatives to be official, which will be voted on Friday 2 January 2009.

Belgian PM resign over Fortis sale

Belgian Prime Minister Yves Leterme and his government resign amid a controversy over the sale of the financial service company Fortis.

Yves Leterme

On July 14, 2008, facing the imminent failure to meet a self imposed deadline to enact “constitutional reform” consisting of further devolution of powers to the nation’s three linguistic communities, Leterme tendered his resignation to King Albert II, the head of state.

On July 17, King Albert, after holding a flurry of consultations with leaders of political parties, labor unions, and the employers’ association, rejected Leterme’s resignation.

Instead, the king appointed a three person commission of representatives of the linguistic communities to investigate how to restart the reform process. The commission was to report to the king by July 31, 2008.

Eurozone in recession

The Eurozone is now officially in a recession, due to the recently released figures showing that, in the third quarter of 2008, the economy shrunk by 0.2%.

European Central Bank

For a recession to be official, the economy must have shrunk for at least two consecutive quarters. This is the case as the Eurozone’s economy also shrunk by 0.2% in the second quarter of this year.

Howard Archer, the chief European economist for Global Insight commented on these results. “Not only did the third quarter contraction in GDP confirm that the Eurozone is now in recession, but latest data and survey evidence indicate that the fourth quarter is likely to see a sharper fall in GDP as the financial crisis bites harder,” he stated.

This development comes after two large countries in the Eurozone, Germany and Italy announced that they were in a recession.

Fortis partially nationalised

Fortis (Euronext: FORA, Euronext: FORB, LuxSE: FOR) is a banking, insurance, and investment management company, and is the 20th largest business in the world by revenue. The Benelux countries are Fortis’ home base and its strength. Fortis’ banking operations include network (retail), commercial, and merchant banking; its insurance products include life, health, and property/casualty lines.

On September 27, 2008 Filip Dierckx was named as the new CEO of Fortis, to be approved by a shareholder meeting, after the shares of Fortis dropped 35% in one week time. Fortis also was subject of discussion on an emergency meeting of the Dutch and Belgian minister of finance and financial regulators, and rumours about partial or total takeovers are spread.

This Bud’s for you. InBev acquire Anheuser-Busch

Belgium/Brazilian brewer InBev announced that it will acquire its U.S. rival Anheuser-Busch for $52 billion ($70.00 per share). This combination will create the world’s largest brewer with brands including Stella Artois and Becks in addition to Budweiser.

The all-cash agreement, for $70 per share, or almost $52 billion, would create the world’s largest brewer, uniting the maker of Budweiser and Michelob with the producer of Stella Artois, Bass and Brahma. The two companies would have yearly sales of more than $36.4 billion, surpassing the current number one brewer, London based SABMiller.

Belgium raid Church of Scientology

Authorities in Belgium have seized documents, financial records and computer equipment form the local branch of the Church of Scientology (Church) and then sealed off the building.

The reports state that the Church in Belgium is being investigated for extortion and fraud for allegedly posting false job openings in newspapers and then attempting to get those who applied to join the Church.

Several ex-members of the Church have also reportedly approached authorities with accusations of intimidation and extortion.

Belgian coalition delivers government

After almost nine and a half months, government formation talks in Belgium have resulted in a new government. New Prime Minister Yves Leterme was sworn in by King Albert II today, together with 15 new Ministers and 7 Secretaries of State. After the election on June 10 last year, a confidence vote in the parliament in Brussels on Saturday is expected to confirm the coalition’s promise of a government in time before Easter.

In his inaugural speech, Flemish Christian Democrat Leterme replied to criticism from the media and opposition that his government’s manifest was vague and that there was no mutual trust between the coalition partners: “We want to increase the faith in the government, not with empty promises, but with specific measures, by investing in health care, the environment, safety and governmental services.”