PARIS, Oct 1 (Reuters) - France could finance its share of a
rescue of Dexia (DEXI.BR:
,
,
,
) (DEXI.PA:
,
,
,
) by borrowing the one billion
euros ($1.42 billion) it will invest in the Franco-Belgian bank,
government spokesman Luc Chatel said on Wednesday.
On Tuesday, France, the Belgian government and other
stakeholders said they would invest a total of 6.4 billion euros
($9.2 billion) in Dexia. The French state said it would invest
one billion euros while French state-controlled Caisse des
Depots (CDC) promised two billion euros.
"The financing method has not been completely set. It is not
impossible that the financing will come from borrowing," Chatel
told a news conference after a weekly cabinet meeting.
"It is not absurd that an investment of this kind be
financed through borrowing."
France could issue government paper, which has generally
attracted strong interest as investors have sought safe havens
amid global financial markets turmoil, analysts say.
One billion euros would be a relatively small amount for
France, Europe's second-biggest economy, to borrow -- Paris last
week announced its total financing requirement for 2009 would
amount to 165.3 billion euros.
Still, France's debt was worth around 65.7 percent of gross
domestic product at the end of the second quarter, above the
European Union's limit of 60 percent.
(Reporting by Sophie Louet; Writing by Tamora Vidaillet;
editing by Swaha Pattanaik)