Dexia announces the creation of a new ‘Lettres de Gage’ bank in Luxembourg: Dexia LdG Banque S.A.
On 3 July 2007, Dexia LdG Banque SA, a 100% owned subsidiary of Dexia BIL, obtained authorisation from the Luxembourg Treasury and Budget Ministry to conduct all business covered by the law of 21 November 1997 relating to ‘Lettres de Gage’ issuing banks.
In accordance with this law, Dexia LdG Banque S.A.’s principal activity will be the refinancing of assets generated by the Dexia group’s public sector financing business in OECD countries and in the European Economic Area through the issuance of covered bonds.
Complementing the two existing issuers of triple-A rated covered bonds within Dexia, Dexia Municipal Agency and Dexia Kommunalbank Deutschland, Dexia LdG Banque S.A. will enhance the group’s refinancing capacity in a context of major development of its flagship local public sector financing services.
After a second half of 2007 devoted to the issuer’s start-up operations, Dexia LdG Banque S.A. plans to enter the international markets from the beginning of 2008, with the objective of rapidly positioning itself as a top ranking issuer in its market.
According to Marc Henry, Managing Director and Chairman of the Management Board, this project is perfectly aligned with the strategy pursued by the Dexia group’s leading business line: “Luxembourg legislation has widened the notion of the eligible assets which may be used as cover for ‘Lettres de Gage’, thus enabling the Dexia group to take a more active part in developing the local economy since it can ensure optimum refinancing of its assets. We have therefore identified, within the portfolios of the Dexia group, a substantial and diversified pool of high quality assets which satisfy the legal eligibility criteria. These assets will allow us to rapidly attain the status of a major player in the ‘Lettres de Gage’ issuance market.”
Marc Henry will lead the new bank together with Jacques Dupuis, currently head of Credit Research in Dexia’s Financial Markets division.
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