Livret A still tops French households’ investments

The French National Statistical Institute (Insee) has published a research on the financial wealth of French households in 2015.

At the start of the year, 93.8% of French households have had assets invested in financial products, real estate or businesses.

Among them, 90.1% have assets invested in financial products while 62.6% own a property and 15% hold business assets. Only 12.3% have assets invested in the three categories.

The study highlights a clear preference of French households for non-risky financial products. The trend has strengthened between 2010 and 2015 as 85.9% of French households have invested their assets in public savings accounts such as Livret A against 85% in 2010 and 83.2% in 2004.

Despite Livret A’s rate has been regularly trimmed since 2013 (current rate is 0.75%), it remains the most attractive financial product to French households according to Insee’s figures. Some 75.8% of them own a Livret A in 2015 when they were only 63.8% five years ago and 57% in 2004.

Insee explains the rise of Livret A’s owners might dwell in an aversion of French households for risky products as well as in the fact that interest rates have been sometimes higher during the 2010-2015 (2.25% between August 2011 and February 2013).

However, outflows have been massive on Livret A in the first nine months of 2015 with €6.21bn being withdrawn by French individuals. A record has even been reached last September with €2.38bn outflows reported.

Life insurance and pensions schemes products reach the second place of French households’ investments in 2015 (44.2% against 42.4% in 2010 and 36,9% in 2009). Investments in home ownership saving plans have slightly risen to 32.2% from 31.2%in 2010 and 41.3% in 2005.

Insee’s research shows French households’ appetite for securities has strongly declined in a decade with 16.5% of them having invested in securities in 2015 whereas the same figures were 19.3% in 2010 and 24.2% in 2004. The financial crisis of 2007-2008 can partly explain this drop, Insee points out.

Insee has also stressed a decrease of French households having assets invested in company savings plans (14.5% in 2015 against 15.1% in 2010 and 16.7% in 2004).

Full research is available here (in French) : http://www.insee.fr/fr/ffc/ipweb/ip1574/ip1574.pdf

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