European financial institution Dexia is in exclusive talks to sell its Turkish insurance operations Deniz Emiklilik to France's AXA and MetLife, French daily Les Echos today reported, without citing sources.
New York-based MetLife, one of the world's largest insurance firm, is in the lead to buy Deniz Emiklilik, while French global insurance group, AXA is close to finalising a deal to sell property and casualty insurance on behalf of Deniz Bank, Dexia's Turkish retail banking unit and is also eying Dexia's life insurance business, the paper said.
Belgian-French financial services group Dexia is selling assets as part of the deal arrived with the European Commission for receiving public bailout in September 2008 during the global financial crisis.
Brussels-based Dexia is a Belgian-French bank engaged in public sector finance, retail and commercial banking services, asset management, financial markets and insurance. Dexia operates primarily in Belgium, France, Italy, Spain, and Portugal.
Following the global credit crisis, Dexia was bailed out by the governments of Belgium, France and Luxembourg through a capital injection of €6.4 billion ($8.7 billion) and a state guarantee for its liabilities for a total amount of €150 billion, effective 31 October 2008.
Belgium provided 60.5 per cent of the guarantee while France contributed 36.5 per cent and Luxembourg 3 per cent.
In September 2009, the three states agreed to renew the guarantee to Dexia's funding for another year, until 31 October 2010. However, considering the improved liquidity situation of the lender, the states lowered the cap on the guarantee to €100 billion.
Dexia, the world's largest municipal lender, had embarked on a cost reduction target of €600 million by 2011. During 2009, Dexia sold €16.5 billion of bonds, reducing the size of the portfolio in the run-off by 15 per cent in 2009 to €134 billion.