Opinion of the European Central Bank of 6 November 2017 on a temporary freeze of the remuneration rate in respect of the French livret A and certain other French regulated savings accounts (CON/2017/45)
Date: 2017-11-06
Institutions: European Central Bank
Subjects: France, account, financial stability, interest, national law, savings bank

EN 

ECB-PUBLIC 

OPINION OF THE EUROPEAN CENTRAL BANK 

of 6 November 2017 

on a temporary freeze of the remuneration rate in respect of the French livret A and certain other 

French regulated savings accounts 

(CON/2017/45) 

Introduction and legal basis 

On  13  October  2017  the  European  Central  Bank  (ECB)  received  a  request  from  the  French  Ministry  of 
Economy  and Finance for an opinion on a draft regulatory provision (hereinafter the ‘draft amendment’) 

freezing the remuneration rate of the livret A, the comptes spéciaux sur livret du crédit mutuel, the livret 

d’épargne  populaire,  the  livret  d’épargne-entreprise,  the  compte  d’épargne-logement  (together  the 

‘related  savings  accounts’).  Each  of  them  is  a  type  of  French  regulated  savings  account,  which  has  a 

remuneration rate linked to that of the livret A. 

The ECB’s competence to deliver an opinion is based on Articles 127(4) and 282(5) of the Treaty on the 

Functioning  of  the  European  Union  and  the  third  and  sixth  indents  of  Article 2(1)  of  Council 
Decision 98/415/EC1,  as  the  draft  amendment  relates  to:  (a)  the  basic  task  of  the  European  System  of 

Central  Banks  (ESCB)  of  implementing  the  monetary  policy  of  the  Union  pursuant  to  the  first  indent  of 

Article 127(2) of the Treaty; (b) the Banque de France; and (c) the rules applicable to financial institutions 

insofar  as  they  materially  influence  the  stability  of  financial  institutions  and  markets.  In  accordance  with 

the first sentence of Article 17.5 of the Rules of Procedure of the European Central Bank, the Governing 

Council has adopted this opinion. 

1. 

Purpose of the draft amendment 

1.1  The purpose of the draft amendment is to set, from 1 February 2018 to 31 January 2020, a fixed 

remuneration rate for the livret A and related savings accounts. In particular, these rates would be 

fixed at 0.75 % for the livret A, at 0.75 % for the comptes spéciaux sur livret  du credit mutuel, at 

1.25 % for the livret d’épargne populaire, and at 0.50 % for each of the livret d’épargne entreprise 

and  the  compte  épargne  logement  respectively.  As  a  consequence,  the  remuneration  formula  on 
which the ECB rendered Opinion CON/2016/512 would not be applied during this period. Similarly, 

the  Banque  de  France  and  its  Governor’s  role  in  making  the  calculations,  proposing  ad  hoc 

revisions and requesting derogations from applying  the rates  would be  temporarily suspended  as 

regards these accounts. 

1  

2   

Council  Decision  98/415/EC  of  29 June  1998  on  the  consultation  of  the  European  Central  Bank  by  national 
authorities regarding draft legislative provisions (OJ L 189, 3.7.1998, p. 42). 
All ECB opinions are published on the ECB’s website at www.ecb.europa.eu. 

 
 
 
 
                                                 
ECB-PUBLIC 

1.2  As  noted  in  the  consultation  request,  the  French  authorities  intend  to  implement  the  above-

mentioned temporary freeze of the applicable remuneration rates in order to reduce the divergence 

between  money  market  rates  and  the  remuneration  rate  of  the  livret  A  and  related  savings 

accounts  (which  the  current  inflation  floor  in  the  remuneration  formula  does  not  allow).  Ultimately 

this would ensure a better monetary policy transmission. Such temporary freeze would be followed 

by  a  further  amendment  of  the  remuneration  formula  of  the  livret  A  and  of  the  related  savings 

accounts in order to better align its remuneration rate with prevailing money market rates. 

2. 

General observations 

2.1  The  ECB  understands  that  the  remuneration  of  the  above-mentioned  regulated  savings  accounts 

would be fixed at the respective currently applicable rates. 

2.2  The  ECB  reiterates  that  it  is  generally  not  in  favour  of  regulating  savings  remuneration,  as  this 

derogates  from  the  principle  of  an  open  market  economy  with  free  competition,  presents 

challenges  for  the  efficient  transmission  of  monetary  policy  and,  to  a  certain  extent,  for  financial 
stability3.  The  discrepancy  between  money  market  rates  and  the  regulated  rates  may  generate 

significant  costs  for  banks,  thus  potentially  impeding  their  financial  intermediation  role  and  the 

stability of the banking system.  

2.3  The  draft  amendment  maintains  a  regulated  fixed  level  of  remuneration  for  a  number  of  French 

savings accounts. The fixed nature of such remuneration for a period of two years cannot ensure a 

remuneration  of  these  savings  accounts  in  line  with  money  market  interest  rates.  The  ECB 

nevertheless understands that the application of the current formula – which the draft amendment 

is  suspending  –  would  lead  to  even  greater  discrepancies  with  money  market  rates  than  those 

resulting from fixing current rates. The ECB therefore encourages the French authorities to revise 

the remuneration formula, which should lead to a better alignment with money market rates, and on 

which it expects to be consulted in due course. 

2.4  Finally, in line with its previous opinion on the subject matter4, the ECB also welcomes the fact that 

the draft amendment temporarily suspends the tasks that have been historically  exercised by the 

Banque de France and its Governor regarding the livret A and related savings accounts.  

This opinion will be published on the ECB’s website following its adoption and in any case no later than 

six months following its adoption.  

Done at Frankfurt am Main, 6 November 2017. 

[signed] 

The President of the ECB 

Mario DRAGHI 

3  
4  

See paragraph 2.2 of Opinion CON/2016/51. 
See paragraph 2.5 of Opinion CON/2016/51. 

2