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Credit, savings: the political agenda imposes itself on the banks



Posted Jan 19, 2022, 7:04 PMUpdated on Jan 19, 2022 at 7:06 PM

With the approach of the presidential elections, the political agenda imposes itself more and more on the economic actors. This is the case in energy with the injunction made to EDF to contain tariffs in the face of soaring prices. It is also true in the bank, while the government multiplies announcements to show its support for the economy.

After the rise in the Livret A rate last week, and before the examination scheduled for next Tuesday of a bill on banking exclusion and the capping of bank charges, Bercy formalized on Wednesday the signing of a financial center agreement. with the Banque de France and the French Banking Federation (FBF) to allow companies in difficulty to spread the repayment of their loans guaranteed by the State (PGE) over ten years (instead of six). Another development, they could postpone the first repayments by six months, at the end of 2022.

“No business in difficulty in the spring”

The PGE, launched in March 2020 and distributed by banks to nearly 700,000 companies, has become one of the symbols of the action implemented by the government to support the economy. He intends to highlight it in his review of the five-year term. “The PGE has been one of the most effective weapons to deal with the crisis, but also to prepare for the economic rebound, which would not have been as strong without this tool”, welcomed this Wednesday Bruno Le Mayor, Minister of Economy and Finance.

“We feel a real concern at the end of the second anniversary of the PGE”, when companies have to start repaying, admits the leader of a banking network. However, “more than half of these first deadlines are concentrated on the months of April, May and June”, in other words at the time of the presidential and legislative elections. “It is obvious that, a few weeks before the presidential elections, it would be a subject to see the loss ratio increase rapidly”, recognizes François Asselin, president of the Confederation of SMEs, who pleaded ardently for this new easing.

If the banking sector supports the approach on the merits, it was more reluctant on the terms and negotiated until the last moment. The public authorities “do not want to see companies in difficulty in the spring”, admits the same banker, who himself is not very worried. Many of them have already repaid their PGE or started to do so. According to the Banque de France, less than 5% of companies that have taken out such a loan may need additional accommodation.

For the banks, there is no question of complaining. Since the start of the health crisis almost two years ago, they have led an objective alliance with the government. Like the European Central Bank, the State held the economy at arm’s length, which made it possible to avoid cascading defaults, and therefore difficulties for the banks. For their part, the latter have also done their share of the work by massively distributing PGEs, granting moratoriums and opening the credit floodgates.

Savings invited into the campaign

With the return of inflation, savings have also entered the campaign. In this context, the increase in the remuneration of the popular savings account (from 1 to 2.2%) but above all the increase in the rate of the passbook A, held by nearly 55 million French people, are not neutral. Revisable twice a year to take inflation into account in particular, his rate of pay has doubled from 0.5% to 1%, a first in ten years!

Here again, the banks, which must provide part of the remuneration, were presented with a fait accompli. “We had pleaded for a strict application of the formula”, recognizes a banker. This should indeed have resulted in a rate of 0.8%. But the government, on the proposal of the Governor of the Banque de France (who took some liberties with the formula), considered that the current level of inflation justified a boost. “A small electoral gesture”, comments Philippe Crevel, savings economist.

The list of banking subjects scrutinized by the government does not stop there. Red cloth for banks, the termination “at any time” of borrower insurance was adopted last November by the National Assembly with the consent of Bercy. It was certainly challenged on Wednesday by the opposition in the Senate, but must be discussed in plenary session on January 26.

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