Dexia collapse fears threaten euro bank dominos

Fitch Ratings agency on Tuesday kept Dexia's debt rating intact but downgraded the credit score of the banking group's Belgian unit after France and Belgium rescued the lender from collapse.Fitch affirmed the Franco-Belgian group's long-term debt rating at "A-plus" and cut the credit score of Dexia Bank Belgium by one notch to "A".The international ratings agency said its actions follow the restructuring of Dexia that was announced on Monday.

Fitch Ratings agency on Tuesday kept Dexia's debt rating intact but downgraded the credit score of the banking group's Belgian unit after France and Belgium rescued the lender from collapse.Fitch affirmed the Franco-Belgian group's long-term debt rating at "A-plus" and cut the credit score of Dexia Bank Belgium by one notch to "A".The international ratings agency said its actions follow the restructuring of Dexia that was announced on Monday.

BRUSSELS (Reuters) - Belgium and France will hold talks to determine the fate of stricken Franco-Belgian bank Dexia in Brussels on Sunday, Belgian caretaker Prime Minister Yves Leterme said after a meeting of core members of his cabinet on Saturday.

NICOSIA — Cypriot President Nicos Anastasiades, seeking a last-minute reprieve from financial meltdown at talks in Brussels on Sunday, has a “very difficult task” ahead of him if he is to save the island’s economy, a government spokesman said. With Cyprus facing a Monday deadline to avert a collapse of its banking system and potential exit from the euro, late night talks in Nicosia to seal a bailout from the EU and International Monetary Fund broke up without result.

The board of beleaguered Franco-Belgian bank Dexia approved the rescue plan agreed by the governments of Belgium, France and Luxembourg, which includes the sale of the Belgian unit for €4 billion to the Belgian state and a €90 billion guarantee over its funding for the next ten years.

Reuters - The French and Belgian prime ministers are set to finalize on Sunday the break-up of Dexia as the bank's collapse added urgency to renewed talks among European leaders over how to counter the euro zone sovereign debt crisis.

France and Belgium rushed to reassure investors after Dexia shares plummeted 37 percent on Tuesday in the wake of reports that the Franco-Belgian bank risked being dismantled due to its overexposure to European debt.