B.C. P3 lender posts largest 2008 loss on key European index

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Dexia, the Belgian-French bank that's bankrolling three major infrastructure projects in British Columbia, saw its stock value plummet by more than 81 per cent in 2008.

It was the largest loss by a company listed on France's benchmark CAC index this past year, ahead of carmakers Peugeot and Renault.

A number of European government's threw Dexia a $11.3 billion lifeline this past fall in the wake of the global credit crunch.

Dexia is one of the key lending partners to three so-called public private partnerships in B.C. -- the Surrey Outpatient hospital, the Royal Jubilee Hospital expansion, and the Golden Ears Bridge.

Last month, Dexia failed to come up with the cash for a similarly structured infrastructure project in the UK forcing the British government to bailout the project with short-term financing.

But the head of Partnerships BC, the government agency charged with implementing the provincial government's P3 schemes, has insisted the the troubles facing Dexia and other P3 lenders won't affect projects in B.C.

On top of its government bailouts, credit problems and hemmoraghing share price, Dexia is also exposed to the alleged Madoff investment fraud by as much as $115 million (US).

The French state bank that helped bail out Dexia is considering carving out the troubled lender's French operations and merging them with the French postal service.