France to raise cap on popular Livret A savings account in February

BNP Paribas SA

Tue 15:55

By Dominique Vidalon
PARIS, Nov 3 (Reuters) - The French government will raise the amount that can be deposited in a tax-free Livret A savings account from February to channel funds towards adapting public buildings to climate change, Prime Minister Sebastien Lecornu said on Tuesday.
The French government is also seeking funds to finance a package of measures which includes €1 billion of investment in university campuses, to help appease student unrest.
"We will increase the limit on the Livret A, we are going to do that in February when we will update the (interest)rate which is bound to increase," Lecornu told parliament
Talks will begin with banks, the finance ministry and the Caisse des Depots et Consignations to agree on a maximum cap, which could be a total of €25,000 to €30,000
Savers can currently put €22,950 in Livret A accounts, which offer a tax-free interest rate of 1.7%
Banks pass on 60% of the €400 billion in deposits to Caisse des Depots, which in turn uses the funds for social housing and construction projects. However pressure is growing for the funds to be used for other public projects.

(Reporting by Dominique Vidalon; Editing by Alexander Smith)
((dominique.vidalon@thomsonreuters.com; +33149495432; Reuters Messaging: dominique.vidalon.reuters.com@reuters.net/))