Dexia’s new tightened management has implemented an ambitious transformation plan to consolidate the Group’s recovery. The plan revolves around three axes: improving its risk profile, refocusing on its historical activities and adapting its cost structures.

Improving its risk profile

Dexia has taken several strong actions aimed at improving its risk profile and the Group’s liquidity: the disposal of certain activities, the reorganisation of trading activities with a cessation of own account trading, and the placing of bond portfolios in run-off.

The Group’s liquidity situation is gradually improving, particularly by virtue of the recovery of the long-term issue programme.

A major milestone was passed with the disposal of its US credit enhancement subsidiary FSA to Assured Guaranty, which was finalised on 1 July 2009, thus considerably improving the risk profile of the Dexia Group.

Refocusing on its historical activities

Dexia’s strategy is now to refocus and to invest in historical client franchises in the field of Public and Wholesale Banking, and in Retail and Commercial Banking.

Reaffirming its commitment to the long term alongside its clients, the Group is undergoing a geographic refocusing on its principal markets France, Belgium, Luxembourg, Turkey, Italy and the Iberian Peninsula. This positioning also involves the cessation of public financing activities in Australia, Eastern Europe (excluding Slovakia), Mexico, India and Scandinavia, as well as a reduction of its activities in the United Kingdom and the United States.

Adapting its cost structures

The transformation plan aims to reduce costs by as much as 15% over three years. The aim is to give the Group greater efficiency and the flexibility which is vital to its development and its profitability.