EMP: less than 100 billion euros for companies to repay

The symbolic threshold of 100 billion euros was recently crossed, meaning that almost a third of the loans guaranteed by the State have already been repaid by their beneficiaries. For the time being, therefore, the risk of companies defaulting on their EMPs remains limited and under control.

Some 685,000 beneficiaries

The PGE is an exceptional guarantee scheme designed to support bank financing for businesses following the economic shock caused by the Covid-19 crisis. Before it was abolished on June 30, 2022, the structures concerned could take out a state-guaranteed loan from lending platforms with the status of intermediary in participative financing.

In all, almost 685,000 companies have obtained an EMP, including 400,000 in April and May alone. According to Bercy, 98 billion euros of the 144 billion euros loaned have yet to be repaid. More precisely, 14% of beneficiaries would have already repaid their loans by 2022. Most borrowers would have opted for a 6-year amortization period corresponding to the total duration of the loan, according to Bpifrance Le Lab, which collected data on the subject.

Controlled risk of non-reimbursement

The fact that there have been no alerts concerning the repayment of state-guaranteed loans means that the risk of non-repayment remains under control at this stage. VSEs and SMEs, the main beneficiaries, have for the most part begun to pay their first instalments in the spring of 2022.

A half-yearly economic survey published by Bpifrance on January 10 shows that only 5% of companies fear they will not be able to repay their loans. This figure corresponds to the 4.6% gross loss rate anticipated by the Banque de France.

The EMPs " were refused at 4% and we had difficulty granting them on 4-5%. In 2022, we found exactly that ," Nicolas Théry, President of Confédération Nationale du Crédit Mutuel, tells Les Echos newspaper.

Number of warranty calls on the rise

The situation is less reassuring with regard to the number of guarantee calls, which has been rising since September 2022. These calls are triggered and recorded by Bpifrance when a company fails to pay its installments.

" This is not a cause for concern at this stage. But it is a trend that needs to be monitored," says Bercy.

These difficulties are due in particular to rising energy costs, supply problems encountered by companies and the slowdown in economic activity. According to figures recently published by Altares, 42,500 procedures were opened in 2022, marking a sharp 50% increase on the previous year.

Despite these factors, the government is reassuring and points out that the amounts set aside in 2021 and 2022 to deal with possible defaults on EMP payments have not been fully used. Last year, almost 2 billion euros were cancelled as part of the 2022 rectifying draft budget.