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State aid: Commission authorises a further EUR 2.45 billion capital injection for Caisse d'Épargne and Banque Populaire
The European Commission has authorised, under the EC Treaty rules on state aid, a further EUR 2.45 billion capital injection into the institution to be created by the merger between the Caisse d’Épargne and Banque Populaire groups. This French Government aid comes on top of that already granted to the Caisse d’Épargne and Banque Populaire groups under the French scheme to inject capital into credit institutions which the Commission approved on 8 December 2008, 28 January 2009 and 24 March 2009 (see IP/08/1900, IP/09/158 and IP/09/461). The aid is in line with the Commission’s guidance on support measures for banks during the crisis (see IP/08/1495 and IP/08/1901).
Competition Commissioner Neelie Kroes commented: "The merger of the Caisse d'Épargne and Banque Populaire groups has technical implications for their level of capitalisation. A further capital injection will help offset potentially adverse effects on the financing of the economy and can be authorised."
The boards of the Caisse d'Epargne and Banque Populaire groups have approved a merger which will see them transfer most of the technical and human resources of their respective central bodies to a common central body. In order to put the new central body, which will be responsible for guaranteeing the liquidity and solvency of the entire group, on a sound financial footing, the French Government wants to increase the amount of capital it allocates to the Banque Populaire and Caisse d'Epargne groups.
On 22 April the French Government formally notified the Commission of its plan to increase the amount of EUR 2.55 billion already approved by the Commission on 28 January (see IP/09/158) by EUR 2.45 billion, to be paid to the Caisse d'Epargne and Banque Populaire groups under the second instalment of the recapitalisation scheme. The two groups had already received EUR 2.05 billion under the first instalment of the scheme. Once the plan has been implemented, they will therefore have received a capital injection of EUR 7.05 billion in total.
After examining the aid measure, the Commission has concluded that the additional capital injection is consistent with its guidance on the recapitalisation of financial institutions (see IP/08/1901).
The non-confidential version of the decision will be made available under case number N 249/2009 in the State Aid Register on the DG Competition website once any confidentiality issues have been resolved. The latest publications of state aid decisions on the Internet and in the Official Journal are listed in the State Aid Weekly e-News.