Annual report 2005 - Dexia.com

DexiaActivity portfolio – Business model – StrategyActivity portfolioBusiness modelStrategyThe alliance between Crédit local de France and CréditCommunal de Belgique in 1996 aimed at creating a EuropeanBank with, inter alia, the ambition to become the worldleader in public finance. By pooling the respective domesticleaderships, Dexia was able to develop a strategy ofinternational expansion based on the strengths of the twofounding institutions.Those shared the same high financial standingand values, and brought to the union theirtwo different business models: Crédit localde France – later renamed Dexia CréditLocal, was essentially an originator of longtermcredit facilities, raising its fundingalmost exclusively on the bond markets;symmetrically, Crédit Communal de Belgique– later renamed Dexia Bank Belgium – wasa network of local branches collecting retaildeposits from private individuals, andrecycling the majority of them in the formof loans to municipalities.Following the merger, Dexia has thus becomeone of the fifteen largest banks in the eurozone (by market capitalization), and today itaddresses two main markets:• local public authorities and borrowers witha similar profile (hospitals, schools, socialhousing institutions, charities, etc.), an activityconducted on a global scale;• households and small and medium-sizedenterprises, an activity conducted mostly inBelgium and Luxembourg.16