France: Financial Sector Assessment Program-Technical Note-Macroprudential Policy Framework and Tools

October 29, 2019

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Format: Chicago

France: Financial Sector Assessment Program-Technical Note-Macroprudential Policy Framework and Tools, (USA: International Monetary Fund, 2019) accessed November 23, 2024

Summary

This technical note on macroprudential policy framework and tools on France highlights that the institutional arrangements provide adequate powers to ensure Haut conseil de stabilité financière’s (HCSF) ability to act; however, some tools remain outside its legal domain. The report also discusses that The HCSF should evaluate effects of tools introduced to mitigate risks from corporate leverage. The HCSF should continue to monitor vulnerabilities in the corporate sector and once enough data is available, evaluate the impact on the tools introduced on: resilience of the financial system; and corporate borrowing behavior. A sectoral systemic risk buffer, calibrated to corporate exposures, could be considered if vulnerabilities intensify. A fiscal measure that incentivizes corporates to finance through equity rather than debt would affect both bank and market-based finance. Such a measure would have an impact on the demand for credit, rather than its supply. The macroprudential policy toolkit should be strengthened further.

Subject: Financial institutions, Financial sector policy and analysis, Financial sector stability, Insurance companies, Macroprudential policy, Macroprudential policy instruments, Systemic risk

Keywords: Bank credit, Banking sector, Banking system, BNP Paribas, Bond market, Coordination role, CR, Financial sector stability, Global, HCSF dashboard indicator, Home equity, Insurance companies, Investment fund, ISCR, Macroprudential policy, Macroprudential policy instruments, Market share, Member institution, Sector risk, Systemic risk

Publication Details

Pages:

39
Volume:

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DOI:

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Issue:

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Series:

Country Report No. 2019/327
Stock No:

1FRAEA2019010
ISBN:

9781513517803
ISSN:

1934-7685

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