Annual report 2010 - Dexia.com

Notes to the consolidated financial statements4. Significant items includedin the statement of incomeReported amounts are significant and/or unusual transactionsand not only large transactions. The amounts mentioned arebefore tax and year-to-date.The sale of 21.8 million Assured Guaranty Ltd common sharesacquired by Dexia as part of the sales price in connection withthe FSA transaction generated a positive result of EUR 153 millionin VI. Net income on investments.In 2010, the European Commission approved the State supportprovided by the Belgian, French and Luxembourg States toDexia and Dexia undertook to restructure its activities.In order to comply with the commitments taken with theEuropean Commission, Dexia continued to deleverage its balancesheet. Assets were sold for an amount of EUR 27.2 bil lion. In thiscontext, a capital loss net of provision has been recognised forEUR -212.5 million.Dexia sold its stake in SPE, Dexia Epargne Pension and inAdinfo with a capital gain of respectively EUR 69 million, EUR29 million and EUR 14 million disclosed in VI. Net income oninvestments.In the context of its restructuration plan, Dexia booked anamount of EUR -145.2 million as restructuration costs.A charge of EUR 380 million was recognised in interest marginfor the retribution of the Belgian, French and Luxembourgstates for the guarantee they give for Dexia's financing andanother EUR 110 million interest charge was recognised forthe guarantee received from the Belgian and French States forFinancial Products' portfolio and the related GIC's liabilities.Otherwise, Dexia recorded a charge of 73 million in II. Interestexpense as contribution to the Belgian deposit guarantymechanism.The Group recorded in XI. Other net income an incomeamounting to EUR 44 million, as a compensation for losseswhich were incurred in the context of the fraud occured inthe dealing room of Dexia Bank Belgium between 1998 and2001, and which were fully accounted for between 2000 and2004 (included).The CDS purchased within the framework of the syntheticsecuritisations Dublin Oak and Wise, together with the CDSintermediation activity, led to a positive mark-to-marketbefore tax of EUR 89.9 million in V. Net income from financialinstruments at fair value through profit or loss.An amount of USD 35 million of deferred tax assets wasrecognised on temporary differences on the Financial Productsportfolio and, following the new carry-back rules on the taxreturn in the US, a tax refund product of USD 51 million hasbeen recorded in XX. Tax expense.On 25 January 2011, the Regional Court of Bratislavarendered a judgment in favour of Dexia, cancelling thefirst-instance judgment of May 2010 by which Dexia bankaSlovensko was condemned to pay an amount in principal ofEUR 138 million. As a result the case will revert back to theFirst-Instance Court of Bratislava which will have to rendera new judgment taking into account the legal evaluation ofthe Regional Court. This does not affect the sale of Dexiabanka Slovensko in accordance with the agreement reachedin November 2010.This decision lead to the reversal of the provision of EUR 138 millionrecognized in 2Q 2010 in XIX. Provisions for legal litigations.However, a provision of EUR 39 million is still being maintainedto cover potential charges, related to the Ritro case.For the significant items included in the statement of incomeof 2009, we refer to Dexia's Annual Report 2009.5. Post-balance-sheet eventsNil.6. LitigationsWe refer here to the chapter Risk Management – part Legalrisk – presented in the Management report on page 89.Management reportConsolidatedfinancial statementsAdditional information Annual financial statementsImpairment on loans and provisions for credit commitmentsincludes EUR -559 million in relation with Financial Productsportfolio.Annual report 2010 Dexia147