THE French and Belgian prime ministers met yesterday to finalise the break-up of Dexia, as the bank’s collapse added urgency to renewed talks among European leaders over how to counter the eurozone sovereign debt crisis.

The governments of France, Belgium and Luxembourg have agreed to dismantle the troubled bank, Dexia.

BELGIUM has warned France that it was not willing to foot the whole bill for rescuing Dexia as the two states started talks to divide up the Franco-Belgian lender’s assets.

GROWING concern over the prospects of the eurozone pulled all European markets downwards yesterday, in most cases for a third consecutive day.

Investors’ confidence was hit from all sides today as the health of Europe’s banking sector moved deeper into critical territory.

The uncertainty over Greece has hit markets around the world, with the Dax in Frankfurt and the CAC 40 in France both down around 3%, while Asian markets also suffered sell-offs overnight.

Shares in Franco-Belgian bank Dexia have fallen more than 37% in early trade this morning amid concerns a collapse or break-up is on the cards.

The ongoing eurozone debt crisis continued to spook investors today with the FTSE 100 Index starting the new quarter on the backfoot.

Stocks in Europe ended sharply higher today after positive retail sales data from the US helped ease concerns that the world’s largest economy is heading back into recession.

Bank stocks recovered their poise today and helped European stock markets push higher as investors assessed the impact of a short-selling ban in four eurozone countries.

THIS week’s shock decision by the EU demanding the break-up of Dutch banking giant ING has caught commentators and analysts by surprise.

EU countries including Ireland are cutting back on their aid to the developing world and some are even using creative accounting to cover the drop in money donated.

The European Commission was still waiting today for the Government to submit for approval full details of its bank guarantee plan.

Some of France’s largest banks and insurers tried to reassure customers and investors today after talks on the financial crisis with President Nicolas Sarkozy.

UK mortgage lender Bradford & Bingley today sold £4.2bn (€5.8bn) of loans as it moved to boost cash reserves at a time of soaring wholesale funding costs.