France Nationalizes Its Second Largest Mortgage Lender
| Date Published |
9/26/2012 |
| Author |
Marja Hoek-Smit |
| Theme |
|
| Country |
France |
September 26, 2012
The French government suddenly announced the
nationalization of troubled mortgage lender Credit Immobilier de France (CIF),
which is the country's second largest mortgage specialist. Finance Minister Pierre Moscovici
said according to Reuters: "To allow the CIF group to respect its overall
commitments, the state decided to respond favorably to its request to grant it
a guarantee". The guarantee will be implemented subject to the approval of
the European Commission and Parliament. EC approval is required under the State
aid procedure. The French government was unsuccessful in finding a buyer for
the troubled CIF and with the downgrade of Moody’s by 3 notches earlier in the
week, nationalization was all but unavoidable.While CIF has only a small branch network with 300 branches, more than
30 billion euros in loans bear its signature. Its ultimate insolvency would
have had serious impacts on the banking system.
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