Annual report 2009 - Dexia.com

2009 and early 2010 highlightsManagement reportConsolidatedfinancial statementsAnnual financial statementsAdditional informationActivity review and job adjustmentsIn 2009 the refocusing of the Group was accompanied bya complete activity review, the direct consequence of whichwas a workforce adjustment.Firstly, projects associated with the transformation of thePublic and Wholesale Banking business line and Treasury andFinancial Markets activity were reflected by a loss of 888 jobsin 2009.Secondly, there were discussions on the transformation of theRetail and Commercial Banking and Insurance business linesand on the tighter organisation of all the Group support lines(Human Resources, Communications & Brand, Operations &Information Technology, Audit, Risks, Finance and Compliance,Legal & Tax).The plan to transform support lines relies on four guidingprinciples:• to create a tighter structure through a simple and clearorganisation in order to optimise decision-taking processesand information flows;• to harmonise the scope of the support lines between all theentities in order to facilitate coordinated governance;• to widen the scope of delegation of entities and to increasetheir responsibilities at the same time as strengthening of theGroup’s hierarchical lines and control procedures;• to increase the Group’s task of guidance and to develop itsroles of impetus and control.Two support line organisation models are created: a strongoperational model and a directive model.In the strong operational model, formal responsibility for thedecision is shared between two or more parties although theinitiative and control of processes only fall upon one of theparties (in principle the support line). The Human Resources,Communications & Brand and Operations & InformationTechnology support lines operate under the strong operationalmodel.In the directive model, both the initiative and control of processesand formal responsibility for the decision, after consultationwith third parties to be involved within the support lineand/or the entity, fall upon a single party. The Audit, Risks,Finance and Compliance, Legal & Tax support lines operateunder the directive model.The Risks and Finance support lines, by their very nature vitalto the Group, were the first to propose a new organisation.The plans to transform the Retail and Commercial Bankingand Insurance business lines and the tightening of the organisationof all the Group support lines will be reflected by theloss of 602 jobs in 2010.These 1,490 job losses in 2009 and 2010 fall within the contextof the programme to reduce the cost base by EUR 600million.Agreement with the EuropeanCommissionA new major milestone was passed by the Dexia Group on5 February 2010, ending a long period of uncertainty. Afterseveral months of discussion, the Belgian, French and LuxembourgStates and the European Commission concluded anagreement in principle on the Dexia Group restructuring planwhich was definitively confirmed by the new Commission on26 February 2010.It is a positive and consistent agreement which enables theGroup to continue to develop its core businesses on its historicalmarkets, France, Belgium and Luxembourg as well asin Turkey.On the other hand, it is perfectly in line with the dynamics ofthe Group transformation plan.In addition to the measures detailed above, which wereacknowledged by the Commission, the agreement providesthe following additional measures, the implementation ofwhich will be the subject of a half-yearly report to the EuropeanCommission by an independent expert.Additional disposalsDuring negotiations with the European Commission, it wasdecided to sell Dexia Crediop in Italy (70% stake) and Dexiabanka Slovensko in Slovakia (85.5% stake) by 31 October2012, as well as Dexia Sabadell in Spain (60% stake) by31 December 2013.Dexia also undertook to:• divest of Adinfo, its subsidiary active in the provision ofIT services to local authorities in Belgium (51% stake) by31 December 2010, as well as its stake in SPE, second supplierof energy (gas and electricity) in Belgium by 31 December2010;• to divest or float DenizEmeklilik, the insurance subsidiary ofDenizBank in Turkey by 31 October 2012.On the basis of an application prompted by the Belgian,French and Luxembourg States, the Commission may authoriseDexia to:• postpone the disposal of one or more of the above assets;• substitute the disposal of one or more assets by one ormore other assets representing an equivalent amount in theDexia balance sheet.The Commission may also decide that one or more of theabove commitments ceases to apply.12Dexia Annual report 2009