BNP Paribas has announced that it is taking control of ailing finance group Fortis's operations in Belgium and Luxembourg.
The deal, thrashed out over a weekend of intense talks, makes Belgium the largest shareholder in the French bank.
It leaves the Belgian and Luxembourg governments with reduced holdings in Fortis.
The governments partly nationalised Fortis a week ago in exchange for part of BNP Paribas, which becomes the biggest bank in Europe in terms of deposits.
Meanwhile, Germany has sealed a public-private rescue plan for the country's fourth biggest bank, Hypo Real Estate, as the government extends a blanket guarantee for all personal bank deposits to avert panic withdrawals.
The announcements came on the eve of a meeting of European finance ministers in Luxembourg, who will seek to flesh out broad plans for restoring confidence in the crisis-struck banking system, agreed over the weekend by Europe's biggest economic powers.
Under the Fortis deal, France's biggest bank will take up to 75% of the company's Belgian operation. The other 25%, which will be a blocking minority on strategic decisions, is in the hands of the Belgian government.
On the Luxembourg side, BNP Paribas will take 66% of the shares leaving the Grand Duchy with 33%.
On Friday the government in the Netherland's nationalised the group's arm in that country.
BNP Paribas Managing Director Baudoin Prot, announcing the deal to reporters in Brussels, said it would be financed by BNP Paribas shares, with the Belgian state taking a stake of 'around 11.7%' in the French bank, making it the largest shareholder.
BNP Paribas put the value of the operation at €14.7bn.
It will also take over Fortis's insurance activities for €5.7bn.
However, the French bank said it would not be taking over €10bn of Fortis's risky assets, which have been placed into a separate structure under the control of the Belgian and Luxembourg governments.
BNP Paribas did though pick up a network of 1,500 bank branch offices in Belgium, Luxembourg, France, Germany, Poland and Turkey.
