The European Commission has given final approval to a French state aid package for Crédit Immobilier de France (CIF) including Eu28bn of guarantees, it announced today (Wednesday).

Joaquín Almunia, Commission vice president in charge of competition policy

The French government put in place temporary guarantees in January that were expected to become permanent upon final approval by the EC after the group faced difficulties accessing market funding in the wake of a downgrade by Moody’s in early 2012.

The EC said that, according to the resolution plan, CIF will cease any new business and run off its assets over a period of 22 years.

“The French authorities decided to resolve CIF because its business model is no longer viable,” said Commission vice president in charge of competition policy Joaquín Almunia. “I am satisfied that the resolution plan of CIF will preserve financial stability while also minimising the burden for taxpayers and any distortions of competition resulting from the state aid that the bank received.”