Annual report 2009 - Dexia.com

Risk managementManagement reportRegulatory capital adequacyAt the end of 2009, Tier 1 capital amounted to EUR 17,573 million,a 9% increase because of higher retained earnings.The AFS reserves on bonds and cash-flow hedge reserves arenot part of the regulatory equity. The positive AFS reserveson shares are added to Tier 2 equity. They would have beendeducted from Tier 1 equity if negative. This is explainedin the accounting principles and rules for the consolidatedfinancial statements published in this annual report.In 2009, Tier 1 ratio further improved by 172 bps to12.3% supported by organic generation of Tier 1 capital ofEUR 1.45 billion (equivalent to 95 bps) and by a decrease oftotal weighted risks by EUR 9.7 billion (equivalent to 77 bps).The core Tier 1 ratio reached 11.3%, up by 170 bps comparedto the end of 2008, illustrating the Group’s solid solvencysituation.(in millions of EUR, except where indicated) 31/12/08 31/03/09 30/06/09 30/09/09 31/12/09Tier 1 capital 16,126 16,427 16,831 17,089 17,573Total regulatory capital 18,077 18,383 19,383 19,591 20,251Weighted risks 152,837 153,314 148,630 144,841 143,170Tier 1 ratio 10.6% 10.7% 11.3% 11.8% 12.3%Capital adequacy ratio 11.8% 12.0% 13.0% 13.5% 14.1%Consolidatedfinancial statementsRatingsThe Group’s principal banking entities – Dexia Bank Belgium,Dexia Crédit Local and Dexia Banque Internationale à Luxembourg– are rated A+ with stable outlook by Fitch (9 February2010), A1 with stable outlook by Moody’s (12 February2010), A with negative outlook by Standard & Poor’s (10February 2010).The triple-A rating of the covered bonds (obligations foncières)issued by Dexia Municipal Agency was affirmed byFitch (22 March 2010), Moody’s (23 January 2009) and Standard& Poor’s (4 February 2010 – stable outlook).Annual financial statementsAdditional informationRATINGS Long term Outlook Short termFitchDexia Bank Belgium A+ Stable outlook F1+Dexia Crédit Local A+ Stable outlook F1+Dexia Banque Internationale à Luxembourg A+ Stable outlook F1+Dexia Municipal Agency (obligations foncières) AAA -Moody'sDexia Bank Belgium A1 Stable outlook P-1Dexia Crédit Local A1 Stable outlook P-1Dexia Banque Internationale à Luxembourg A1 Stable outlook P-1Dexia Municipal Agency (obligations foncières) Aaa -Standard & Poor’sDexia Bank Belgium A Negative outlook A-1Dexia Crédit Local A Negative outlook A-1Dexia Banque Internationale à Luxembourg A Negative outlook A-1Dexia Municipal Agency (obligations foncières) AAA Stable outlookDexia Kommunalbank Deutschland (Pfandbriefe) AAA Negative outlook68Dexia Annual report 2009