Dexia bank bail-out puts pressure on Belgian economy

The Belgian government is to help bail-out the troubled bank Dexia, over fears that it could go bankrupt.

It will buy the bank's division in Belgium for 4bn euros ($5.4bn; £3.4bn), and offer 60.5% of the bank's 90bn euros ($122bn; £78bn) in state guarantees, to secure borrowing over the next 10 years.

Tobias Blattner, euro-area Economist for Daiwa Capital Markets, warned that markets were worried by the impact of the move on Belgium's own economy.

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