Bank failures, here are the guarantees for your Livret A and current account

This is a question you have asked yourself at least once in your life. What would happen in case of bank failure or bank run in English ? What would happen to your savings on booklet A or your money in your checking accounts? Rest assured, in the event of a disaster scenario, there is a public service body, the FGDR (Deposit Guarantee and Resolution Fund) who will compensate you.

Livret A, current accounts: what are the protections of the French in the event of bank failure?

The French fear a bank failure as much as the banks themselves! This is what just happened on Friday March 10th for the Silicon Valley Bank (SVB)a bank for American start-ups.

In fact, this bank fell into the vicious circle. Bad news about his condition is circulating, worrying customers. They decide to withdraw all their money. Faced with mass requests, the bank is unable to respond to customers due to lack of liquidity. As a result, it is forced to sell the assets at a loss. This action accentuates its difficulties, which are called solvency crises.

Furthermore, the problem in this type of situation is that other banks can also be contaminated and lead to a more general crisis.

Don’t panic, this bank failure situation it is not current in France. “French banks are not exposed to any risk as a result of the bankruptcy of the SVB”Elisabeth Borne said on March 15 in the Senate. There are safeguards to avoid these scenarios. In France, bank deposits are guaranteed through a public service body, the FGDR, created in 1999. In case of problems, thethe organization reimburses customers in seven working days. Something to inspire confidence!

A full refund for Booklet A, LDDS, LEP in the event of a bank failure

In the event of a bank failure, keep in mind that the savings you put up a booklet A, an LDDS or an LEP are fully covered. For the current accountsyou will be compensated up to 100,000 euros. The same goes for ordinary savings accounts, the Livret Jeunes, the home savings plan, etc.

“Within a few days of your bank’s bankruptcy, we will open a secure space on the Internet for its customers, where you should register and indicate your new bank account number, so that we can pay the compensation. »explains Thierry Dissaux, president of the FGDR.

Important info: This is 100,000 euros per individual, not per family, and also per bank. But beware, if you have a Hello Bank and BNP Paribas account, it’s the same group, so that’s 100,000 euros in total on both accounts.

On the other hand, keep in mind that most online banks have their own own banking licence and belong to the FGDR on their behalf. As in the case of Boursorama, Fortunéo or Monabanq, branches of other banks. For example, if you have money at Fortuneo and Crédit Mutuel Arkéa, its parent company, your funds will be covered up to €200,000 or €100,000 by both parties.

“If your bank is foreign but located in the European Economic Area, for example Germany’s N26 or Lithuania’s Revolut, you are not covered by the FGDR. It is the German or Lithuanian fund that will cover you, globally equally”informs Dissaux.

What about other solutions where you can have money

And on apps Lydia or Nickel ? “These establishments cannot be members of the FGDR. However, they have to deposit their clients’ funds in a special account in a bank. If it is the payment institution that goes bankrupt, customers will have to be reimbursed by the liquidator on the basis of the appropriate account, but the procedure may require more time and less supervision. »says Mr. Dissaux.

THE FGDR also compensates for the “ titles ». “But the compensation occurs only if the security has disappeared, on the occasion of fraud or a serious IT failure that would lead to the institution’s bankruptcy. In other cases the title has not disappeared, you remain the owner, there is no need to compensate.says Dissaux, who also indicates that cryptocurrencies do not fall under this type of protection.

Finally, the FGDR also indemnifies life insurance. The Personal Insurance Guarantee Fund will take over. In particular, reimbursement is limited to 70,000 euros per person and per insurance group. We hope this article on bankruptcy protections has reassured you!