Document Type

Case Study

Case Series

Credit Guarantee Programs

JEL Codes

G01, G28


After the collapse of the Lehman Brothers in September 2008, financial panic and uncertainty intensified in Europe. In France, banks faced a widespread confidence crisis driven by fear that they were exposed to the US subprime market. In response, on October 13, 2008, the French government passed the “loi de finances rectificative pour le financement de I'économie.” This provided for the establishment of the Société de Financement de l’Economie Française (SFEF), a special purpose vehicle (SPV) jointly owned by the State and a group of banks and responsible for refinancing major French credit institutions. The SFEF raised funds on the international market and used the proceeds to provide collateralized loans to major credit institutions. SFEF debt was guaranteed by the French government. The SFEF was active from October 2008 to September 2009 and provided approximately €77 billion in funding to a group of institutions that included the vast majority of the major French banks. In September 2009, the Caisse de Refinancement de l’Habitat, a French credit institution specifically focused on housing finance, took over the SFEF’s outstanding debt management.

Date Revised