The Deposit Guarantee and Resolution Fund (FGDR) was pleased on Tuesday to have reached its target for covered deposits at the end of 2023, at 7.4 billion euros, on the occasion of the publication of its annual report.
“In 2023, we have reached the target level of resources set by the European Union and have resources for deposit guarantee of 0.5% of all deposits covered,” declared the chairman of the board of directors of the FGDR Thierry Dissaux, quoted in a press release.
The FGDR is responsible for intervening in the event of failure of a banking establishment: each French person is covered up to 100,000 euros by this fund. This coverage is largely theoretical since the FGDR only has 0.5% of the amount covered, estimated at 1,472 billion euros. It is the concentration of the banking system in France, around six large establishments (BNP Paribas, Crédit Agricole, Société Générale, BPCE, Crédit Mutuel and Banque Postale), which allows it to apply this fairly low coverage ratio.
Other dikes upstream
The FGDR’s resources increased last year but to a lesser extent than in 2022. All types of guarantees combined (deposits, securities, guarantees), the Fund has 7.7 billion euros.
To the fund are added other dikes, positioned upstream, to avoid bank failures : regular and thorough control by the supervisor, strong regulatory requirements in terms of capital in particular, a resolution mechanism and a European fund of nearly 80 billion euros.
The setbacks in March 2023 of three banks in the United States, Silicon Valley Bank (SVB) in the lead, as well as the catastrophic takeover of Credit Suisse by UBS at the same period, had revived questions last year about the mechanisms of protection of savers.
Reproduction forbidden.