press release

Dexia to acquire EUR 3 billion Social Housing loan book from Bradford & Bingley in the UK

Brussels, Paris, November 20, 2007. Dexia announces today the signing of the agreement with Bradford & Bingley concerning the sale of a EUR 3 billion equivalent loan portfolio in the social housing sector.
Dexia seizes an important opportunity in Great-Britain. The acquisition of this EUR 3 billion loan portfolio allows Dexia to broaden its customer base and command a market share of around 8% on a priority sector for its development in Great-Britain. Achieving critical size will enable the group to increase its visibility and make the most of its product range. It is, in terms of risk profile, an activity that is very similar to that conducted on the public sector. Historically, no default has been recorded with this clientele, which is closely regulated by the Housing Corporation. This operation is in line with Dexia's development strategy within Public Finance.
Dexia will acquire this loan portfolio at par value, and regulatory capital utilized for this purpose under the Basel 1 referential is estimated at around EUR 150 million. Impact on the Tier 1 ratio will be about 10bp. Under the Basel 2 framework - which applies as of 2008 - the amount of capital invested in this transaction will decrease. Dexia group's strong liquidity and refinancing capabilities will also contribute, among other, to create value.
Commenting on the acquisition, Bruno Deletré, member of the Management Board and head of Public & Project Finance and Credit Enhancement, said:
"The acquisition of a social housing portfolio is both an important step for Dexia¿s Public Finance operations in the UK, and the continuation of a dynamic international expansion strategy. This transaction also confirms, in many respects, that the difficult financial markets environment is a source of development and profitability for Dexia".
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