Big Belgian Lender Dexia Announces 3.6 BILLION Euro Loss On Coming Asset Sales

hand over mouth upset worry

[credit provider=”HidingInABunker via Flickr” url=””]

Original post: Something’s up.Markets around the world just turned lower on news that Belgian financial institution Dexia has seen its shares halted pending announcement.

The company is a big-time lender to European local governments, so that’s obviously a huge concern.

Add this to the Fitch lower of the Japan outlook, and suddenly everything is moving down from earlier highs.

Update: There’s speculation that the news could have someting to do with this recent ZeroHedge story, about a recent bond offering from the company that may be put back to it in light of its Greeece exposure.

Update II: It’s a little unclear what’s going on.There’s a report about the company being affected in an unrelated fraud case, but there’s a report in Les Echos about the company accelerating asset sales. An announcement on that could come today. Either way, credit default swaps for the company have hit the highest since April 1 (while we wait for the stock re-open). Markets have recovered a lbit from the earlier slide.

Update III: Just out, via Bloomberg, Dexis will book an EUR 3.6 billion loss in Q2 on asset sales. The sales — designed to get solvency ratios to targets — will comprise of mostly US residential mortgage backed securities.

The full announcement is here (.pdf).