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BY ADAM SMITH
ANCHOR ANA COMPAIN-ROMERO

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The eurozone crisis has claimed its first victim of 2011. The board of Belgian-French bank Dexia has agreed to a bailout plan by the governments of Belgium, France and Luxembourg. CNN has more details.

“The Belgian unit of the bank is to be sold for 4 billion euros, that’s about $5.4 billion at today’s prices. The three governments involved in the bailout have also agreed to guarantee up to 90 billion euros, that’s $121 billion, of funding over the next decade.”

But Belgium’s largest bank has been in trouble before. Dexia got a $9.4 billion bailout in 2008 as a result of the economic crisis. But things have only gotten worse. As Der Spiegel reports, toxic assets from struggling countries have poisoned the company and prevented its recovery.

“Ultimately, its exposure in Greece, from which it holds [$5.2 billion] in government bonds, Italy and struggling American municipalities led other banks to stop lending it money...forcing Monday’s government action.”

Dexia provides financial services to the public sector in almost all European countries, Turkey, Israel and the United States. But the bank will soon cease to exist in its current form. CNBC explains what the company’s future looks like.

“Now, it’s being split up into four. Belgium’s just nationalized the retail unit here. France is taking over the municipalities section and folding it into two state French banks. And the private bank in Luxembourg, we think, is going to be sold, or in negotiations to be sold, to the Qataris. And then the French and Belgian governments offer guarantees.”

With many European countries closely watching their credit ratings, it might not seem smart for national governments to take on the debt of a troubled bank. But as the Wall Street Journal reports, credit ratings agency Moody’s doesn’t see a major impact as a result of the decision -- at least for France.

“Ratings firm Moody’s, which last week put Belgium’s Aa1 sovereign rating on review for a downgrade ... declined to comment Monday on the impact on Belgium ... However, Moody’s did say the decision should have only a limited impact on France’s triple-A rating.”

Then again, in a video accompaniment to that article, Wall Street Journal analysts suggest this is a symptom of greater ills within the European banking community.

“They were ignoring the liquidity risks these banks were facing ... It’s pretty uniquely screwed-up in terms of the problems it has, but if things keep getting worse a lot of people are worried that other banks are going to find themselves in the situation that Dexia now finds itself in.”

Bloomberg shows markets either responded favorably to the news or were unaffected as London, Frankfurt and Amsterdam all closed with gains, though Dexia shares closed down almost five percent.

Transcript by Newsy.