Dexia to cut 665 jobs, save 160 mln eur

The job cuts are slightly less than Belgian media had been speculating.

The measures are part of a three-year 600 million euro ($778 million) cost savings plan announced in 2008 that Dexia is implementing after being bailed out during the credit crunch.

It has already achieved 360 million euros of cost cuts, with the loss of 1,500 workers, and the new job losses would contribute to saving a further 160 million euros.

The first impression we have is that the plan relies heavily on economies to be realised by the departing of personnel but the rest of the plan is rather shady and some easy-to-realise economies on the buildings and the consultants remain in the dark, said a spokesman for Belgium's BBTK union.

It said in a statement on Wednesday that it was confident in its ability to achieve the target.

Dexia has already pared down its activities, principally selling its U.S. bond insurance unit, but still has to sell its public financing activities in Italy, Slovakia and Spain as well as its insurance business in Turkey.

It presented the proposals to its European Works Council on Wednesday morning. Dexia has said it aimed to avoid forced redundancies.

Dexia, a large lender to municipalities in France and Belgium, received a 6.4 billion euro bailout by France, Belgium, Luxembourg and key shareholders in September 2008 and later won state guarantees for its new borrowing. ($1=.7711 euro) (Reporting by Ben Deighton and Philip Blenkinsop; Editing by Will Waterman and Louise Heavens)