Belgium to Sell 20% Stake in Belfius Bank for €2 Billion

The Belgian federal government has launched a formal search for a buyer for 20% of the shares in state-owned bank Belfius, a partial privatization expected to yield approximately €2 billion for the state treasury. The search for investors began Monday, June 22, 2026, through the Federal Participation and Investment Company (SFPIM), marking a significant shift in the government’s relationship with a bank that has been fully state-owned since the 2011 Dexia bailout.

Why Is the Government Selling?

The primary motivation behind the sale is fiscal consolidation. Belgium faces both a large budget deficit and a high national debt, and the one-time revenue from the sale would be used to reduce borrowing. As VRT NWS financial-economic journalist Michaël Van Droogenbroeck explained: “We have not only a large budget deficit, but also a high debt. The proceeds from the sale would in principle be used to pay down part of that debt, thereby lowering interest costs that also weigh on the budget.”

Beyond the fiscal rationale, the current government under Prime Minister Bart De Wever (N-VA) holds a philosophical conviction that it is not the state’s role to own a commercial bank — a departure from the previous Vivaldi coalition, where Green parties insisted on maintaining full state ownership.

The Financial Picture

Belfius has been a profitable success story since its nationalization. The bank posted a net profit of €1.16 billion in 2025 and paid approximately €440 million in dividends to the state in 2024. Since the 2011 takeover, Belfius has returned nearly €3 billion in total dividends to the Belgian government — approaching the €4 billion the state originally paid to rescue Dexia Bank Belgium.

The 20% stake being sold values Belfius at approximately €10 billion. HLN stock market expert Pascal Paepen noted that this represents a price-to-earnings ratio of about 8.6, describing it as “a fairly normal, achievable price that is certainly not overestimated.” The trade-off for the government is clear: a large one-time infusion now, but 20% less dividend income in future years.

No Public IPO

Originally, a public offering was considered, similar to what was planned in 2018 before being scrapped due to the Arco cooperative case. However, the banks advising on the transaction concluded there were insufficient buyers for a successful IPO. Instead, the government will seek institutional investors. Potential candidates include wealthy Belgian families (similar to KBC’s ownership structure), strategic investors such as ING or Rabobank, and private equity groups like CVC Capital Partners.

What It Means for Customers

Expert opinions are divided on the direct impact on Belfius’s 3.5 million customers. Van Droogenbroeck argues that with only 20% being sold, there should be no immediate visible effects. However, Paepen warns that banking costs are likely to rise. “Banking services in our country are still relatively cheap compared to abroad, but with the arrival of a new partner, costs will likely go up,” he said. Paepen also reassured depositors that their savings remain protected under the legal deposit guarantee of up to €100,000 per person, or €200,000 per household — noting that Belfius has never had an explicit state guarantee, only an implicit one.

The Ethias Question and European Pressure

MR party chairman Georges-Louis Bouchez has been pushing for a merger between Belfius and Ethias, the insurance company partly owned by various Belgian governments. The core cabinet agreed only to “study” the proposal — a diplomatic way of deferring the idea. The SFPIM has been asked to produce a study on Ethias’s future scenarios by July 21, 2026.

Meanwhile, according to Paepen, Europe is pushing for governments to divest from state-owned banks, arguing that state ownership creates unfair competition with private banks under EU rules.

Historical Context

The sale marks the latest chapter in a long history. Belfius traces its roots to 1860, when its predecessor Gemeentekrediet was founded to finance local governments. After the 2008 financial crisis, Dexia Group collapsed, and in October 2011, the Belgian government nationalized Dexia Bank Belgium for €4 billion, renaming it Belfius in February 2012. A planned IPO in 2018 was blocked by CD&V over the unresolved Arco cooperative case — an issue that is notably not being raised this time.

What’s Next

The formal search for investors begins now, with the sale expected to be completed by autumn 2026. The Belgian state will retain 80% ownership, and the government’s philosophy suggests further sales are possible in the future, though no plans have been announced beyond this 20% tranche. The identity of the eventual buyer — and whether they will be a Belgian family, a foreign bank, or a private equity firm — remains the key question as the process unfolds.