Belgian State-owned bank Belfius has said it no longer wants to work with the Brussels Capital Region, citing the region’s budget problems.
Belfius has terminated its decades-long role as the capital’s primary financial partner.
Negotiations to extend the partnership until March 2027 collapsed, with Belfius offering only a bare-bones service through the first half of 2026 as a transitional gesture.
The decision, unveiled in today’s editions of newspapers L’Echo and De Tijd, stems from mounting fiscal woes in the bilingual region. They included a downgraded credit rating, ballooning deficits and the protracted absence of a functioning administration some 18 months after national elections.
In October, Belfius said it would stop its cash credit line worth of €500 million from January 1, 2026. Such a credit line usually serves to alleviate temporary liquidity problems.
On November 18, the Brussels region’s new budget minister Dirk De Smedt warned that a full shutdown of public services was a real threat if the region continues to struggle to find money.
Local leader of the Liberal Party (Open VLD), Frédéric De Gucht, likewise has warned that a shutdown was probable starting from April or May next year.
Today, its total debt is believed to be well over €10 billion.
Belfius, born out of the ashes of the 2011 Dexia bailout and still majority-owned by the Belgian State, has served as Brussels’ “principal banker” since the days of its 19th century predecessor, Gemeentekrediet.
The abrupt rupture leaves the region scrambling for a replacement, with De Smedt (Open VLD) already calling for an urgent public tender to secure new arrangements.
The minister is currently also negotiating with lender ING for another cash credit line of €500 million, although ING had indicated it might stop working with Brussels as well.
If that happens, Brussels reportedly would have little hope of having the cash it needed to fully function throughout the coming year.
Complicating matters further, starting in January, a large number of unemployed people will no longer receive benefits due to a federal reform, shifting a significant financial burden onto local authorities.
In addition, an indexation of 2 per cent is set to kick in on March, pushing up the wages of all civil servants in Brussels.
The region’s predicament is further exacerbated by the ongoing coalition talks among nine parties — Ecolo, Groen, PS, Vooruit, MR, Open VLD, DéFI, Les Engagés, and N-VA — that have stalled over ideological rifts and budget austerity demands.
Brussels is not alone in its woes. Several major cities in Wallonia, Belgium’s French-speaking southern region, are similarly facing acute financial distress as major banks refuse to extend direct loans or credit facilities.
This crisis primarily affects urban centres governed by Socialist-led coalitions, often involving the Socialist Party (PS), which has long dominated local politics in these areas.
The refusals stem from concerns over unsustainable debt levels, structural economic decline and perceived risks from progressive spending policies.
Ageing and debt make Italy, France and Belgium the weak links of Europe, according to the latest study published by the National Bank of Belgium. https://t.co/Z0NdMslAkt
— Brussels Signal (@brusselssignal) November 13, 2025
