PELs opened before March 1, 2011 are in the sights of the Banque de France and the Court of Auditors. Their rate, which is far too profitable, could be lowered.
Old PELs could see their remuneration modified -iStock-Christophe Badouet
A rate of 4.5%
During the presentation of its annual report by the Regulated Savings Observatory on 7 September, the Banque de France once again singled out PELs opened before 1 March 2011. These savings products show effect a very attractive rate of return, 4.5% on average. The director general of the institution, Olivier Garnier, attacked frontally the remuneration of these PEL whose rate “virtually guaranteed for life, […] weighs on the financing of the French economy and only benefits savers who have opened a PEL and have not used it since”. Following this line, the Court of Auditors denounces the current use of PEL subscribed before 2011, the placement of which has been “diverted from the historical objective of home ownership to become a long-term savings product “.
€107.7 billion
Unlike contracts taken out after March 1, 2011, PELs from before 2011 have an unlimited lifespan. As the rate is fixed for life, some home savings plan holders have been receiving high interest for decades. According to the Banque de France, these very lucrative contracts represented nearly 107.7 billion euros last year, with an average remuneration of 4.5%, against 3.04% for all housing savings plans. In addition, public finances would suffer from PEL opened before 2018, which are exempt from income tax until their thirteenth anniversary. They also allow, if they are spent for a loan, to obtain a State bonus, the amount of which is calculated according to the interest received and capped at 1,525 euros. Thus, according to the Court of Auditors, these “old” PELs will have cost the State 411 million euros in 2022.
“Suppression Device”
The sages of rue Cambon therefore advised the government to think about a device for abolishing these old contracts. A recommendation of which the Minister of the Economy Bruno Le Maire indicates that he “took note”, although concrete implementation seems difficult. PELs are contracts between banking institutions and individuals. Banks are therefore required to respect the contractual clauses. If the latter decided to lower the interest rate for savings accounts opened before March 1, 2011, they would be exposed to major litigation. The Court of Auditors therefore also proposes several alternative solutions, such as a closure negotiated between the banks and their customers, with compensation or a modification of the current contracts by law in the name of the general interest. This second option would imply, in return, the commitment of the institution to finance priority projects, such as the ecological and energy transition.