DBRS Discontinues and Withdraws Ratings on Dexia Banque Internationale à Luxembourg (“Dexia BIL”)

DBRS Inc. (DBRS) has discontinued and withdrawn its ratings on Dexia SA’s (Dexia or the Group) former operating entity’s – Dexia Banque Internationale à Luxembourg (Dexia BIL or DBIL), including the Long-Term Debt and Deposit rating of A (high), the Short-Term Debt and Deposit rating of R-1 (middle), the Subordinated Debt rating of A, and the Junior Subordinated Debt of A (low). All ratings had been put Under Review Negative when Dexia announced the implementation of a restructuring plan in October 2011 which included the disposal of various entities. The rating actions follow the European Commission approval of Dexia S.A.’s revised orderly resolution plan on 28 December 2012.

The ratings for Dexia’s current and former principal subsidiaries reflected the combined strength of the Group, which operated these entities as integral components of its overall franchise. Therefore, the review was originally triggered by changes to the structure of the Group, the impact that these changes could have on the creditworthiness of its subsidiaries, among which Dexia CL (DCL) but also Dexia Bank Belgium (now Belfius) and Dexia Banque Internationale à Luxembourg (now BIL), as well as the nature and extent of government support. With EUR 356 billion in assets as of end-2012, DCL is now the main operating subsidiary of Dexia. The Group had EUR 357 billion in assets as of 2012. The signing of the Share Purchase Agreement (SPA) of DBIL took place in April 2012, followed by the closing of the acquisition on 5 October 2012. It is now 89.92% owned by Precision Capital, a Qatari fund, and 9.99% by the Grand Duchy of Luxembourg.

DBRS endeavours to complete rating reviews prior to the withdrawal of ratings. However, in the case of DBIL, DBRS was unable to resolve the Under Review situation due to the lack of sufficient information. As such, the ratings have been discontinued and withdrawn according to DBRS Rating Policies & Procedures.

Note:
All figures are in Euros (EUR) unless otherwise noted.

The principal applicable methodology is the Global Methodology for Rating Banks and Banking Organisations. Other methodologies used include the DBRS Criteria – Intrinsic and Support Assessments and DBRS Criteria: Rating Bank Subordinated Debt and Hybrid Instruments with Discretionary Payments. These can be found at: http://www.dbrs.com/about/methodologies.

[Amended on January 12, 2015 to reflect actual methodologies used.]

The sources of information used for this rating include publicly available company documents and SNL Financial. DBRS considers the information available to it for the purposes of providing this rating was of satisfactory quality.

Lead Analyst: Roger Lister
Rating Committee Chair: Alan G. Reid
Initial Rating Date: 5 December 2007
Most Recent Rating Update: 7 October 2011

For additional information on this rating, please refer to the linking document under Related Research.