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<strong>Dexia</strong>Public/Project Finance and Credit EnhancementAmericaFinancial SecurityAssuranceGrosspresent valueoriginations(in millions of USD)l llllllllllllllllllllllllllllll ll l2004l llllllllllllllllllllllllllllll ll l2004927325,808l llllllllllllllllllllllllllllll ll l<strong>2005</strong>l llllllllllllllllllllllllllllll ll l<strong>2005</strong>1,014Net paroutstanding(in millions of USD)351,398• CanadaIn Canada, <strong>Dexia</strong> operated on the PPPfinancing of two major road and publictransport infrastructure projects in theVancouver region. Announced in 2004, theplan to open an entity in Canada becamea reality in <strong>2005</strong> with the obtaining of anauthorization to operate on Canadianterritory from a bank branch: <strong>Dexia</strong> CréditLocal Canada. The opening of this has alreadypermitted a considerable increase in thevolume of <strong>Dexia</strong> activity on the Canadianmarket both in the public sector and in thefield of structured financing.• MexicoThe plan to open a <strong>com</strong>mercial representationin Mexico became reality in <strong>2005</strong>. Thesupervisory authorities granted the statusof Finance Company (SOFOL – SociedadFinanciera de Objeto Limitado) andoperations are in the name of <strong>Dexia</strong> CréditoLocal México. The young subsidiary hasalready been involved in its first financing inan amount of EUR 33 million to the State ofMichoacan, on Mexico’s Pacific coast.• Financial Security AssuranceFinancial Security Assurance (FSA) carriesout the activities of credit enhancement formunicipal bonds and asset-backed securities(ABS) in North America and also in Europe.Credit enhancement of municipal bondsconsists of guaranteeing bonds issuedprimarily by municipalities. By giving themthe benefit of its excellent AAA rating,FSA enables them, by way of a premium,to access the bond market under the mostadvantageous conditions. Credit enhancementof asset-backed securities is a guaranteesimilar to that granted for bond issuesrefinancing different asset classes (consumercredits and so on).During <strong>2005</strong>, FSA achieved a volume ofgross present value (PV) originations equalto USD 1,014 million, which represents anincrease of 9.4% in <strong>com</strong>parison to the recordvolume already achieved in 2004. These verygood results are due to the momentum ofthe American municipal sector in <strong>2005</strong> anda significant volume of international projectfinancing transactions.As regards net par outstanding insured at theend of December <strong>2005</strong>, these amounted toUSD 351 billion, up 8% on December 2004.We note that FSA, which closely monitorscounterparts hit by hurricanes Katrina andRita, has had no claims in that regard so far.62
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