Brussels - Shares in fallen Belgian banking giant Fortis surged by over 40 per cent on Monday morning as investors gave an enthusiastic welcome to a sell-off deal agreed with French bank BNP Paribas over the weekend.

As markets opened, Fortis shares jumped up to 1.42 euros (1.80 dollars), 42.6 per cent above the close on Friday. They fell back during early trading to 1.20 euros, 25 per cent above Friday's close.

The spike came after the Belgian government agreed to sell 75 per cent of Fortis, which it took over in October in a dramatic bid to save the troubled lender, to BNP Paribas for a reported 2.88 billion euros.

Under the deal, the bank also takes a 25-per-cent stake in Fortis Insurance Belgium SA in a transaction worth 1.38 billion euros.

The deal will "guarantee Fortis' essential role in serving the Belgian economy," give BNP Paribas a "strategic reinforcement of its pan-European system" and create a "strong industrial partnership in the sphere of banking and insurance," a statement on the website of Belgian premier Herman van Rompuy said.

Fortis fell victim to the financial crisis sparked by the collapse in the market for insufficiently secured US housing loans known as subprime mortgages.

In October, the Belgian and Dutch governments stepped in. Their rescue plan was based on splitting the bank into its component parts with the Dutch government taking over the Dutch segment and the Belgian state selling a majority stake to BNP Paribas.

But last month, Fortis shareholders, angry at the plummeting value of their stock, rejected the original deal. They are set to vote on the revised deal at a meeting planned in early April. (dpa)