After the State Audit Bureau, it was the turn of the banking profession to evaluate state-guaranteed loans (PGE), whose marketing has stopped since June 30. on this date, “Almost all the companies that have subscribed to PGE have started to pay it off”Refers to the French Banking Federation (FBF), without any noticeable difficulty. According to FBF estimates, a quarter of the outstanding PGE, according to aggregate indicators from the six major banks, was paid.
At the end of 2021, out of 647,000 government service providers – 95% of the total – 11% had repaid in the first year while 72% chose to repay over 4 to 5 years, including 57% who chose the possibility of deferring an additional payment. general. Within the scope of the six major banks, about 883,000 PGE applications were submitted for a total of €145.5 billion. The rejection rate remained steady at 2.9%.
Very low failures
For now, failures remain the exception. Thus just over 300 files were examined by credit brokerage in the second quarter, which is a very low rate. The company’s cash flow remains satisfactory, the default rate is very low, and according to Bpifrance Business Survey (July 2022), more than half of SMEs/VSEs have used PGE completely or mostly and only 6% fear repayment difficulties.
According to the Banque de France, the default rate on PGEs can barely reach 3.1%, well below the 7% estimated at the launch of the system in March 2020, for a total loss of €4.6 billion. A somewhat positive assessment was confirmed by the Court of Audit, which ruled, in a report published on 25 July, that the agency ” It made it possible to support the provision of credit by banks and to avoid massive corporate bankruptcies in the context of an unprecedented crisis “.
3 billion euros cost
In fact, the report notes, of the 137 billion euros granted by banks at the end of December 2021, more than 70% were granted as of June 2020. Small businesses have benefited greatly from the system: they account for almost 90% of the number of PGEs and 36.7 % of transgressors. The risk-sharing is also well balanced, according to the consultants, and the final cost of the state’s PGE – which guarantees between 70% and 90% of the loan – should not exceed €3 billion. The cessation of such support to the economic fabric is few.
The fact remains that the economic context has deteriorated sharply since the Russian invasion of Ukraine, even if corporate results are still driven by the dynamic recovery of 2021. But concerns now focus on 2023, a full-year repayment of PGEs, while the recession-starting scenario in The eurozone is taking some consistency, especially in Germany. “It is possible that the estimate of the default rate will be revised upwards but we will remain at a non-dramatic rate.”credit broker, Frederic Wisnovsky, during an interview with AFP on July 25.