He reminded the audience and panellists that the French banking profession opposes a Basel agreement that would undermine the European financing model and effective risk management by banks. It was by managing risks well that French banks held up so well during the financial crisis. He supported Governor Villeroy de Galhau on his opposition against a “Basel 4 agreement”.
Current negotiations are dealing with an agreement that would not be good for us, that does not recognise the specific features of our funding model.
From a national competitiveness perspective, we need to maintain a level playing field in the enforcement of regulations, regardless of the jurisdiction. The recent report of the US Treasury raises questions on a fair implementation of Basel regulations in the US.
Beyond fair competition, it’s a matter of Europe’s and France’s economic and industrial sovereignty. Benoit de La Chapelle continued by explaining that we need large banks to accompany large companies internationally and ensure the development of our medium-sized companies.
He pointed out that UK and US banks already have more than a 50% share of the EU Corporate and Investment Banking market. This share has risen more than 10 points in 10 years to the detriment of European banks. Major European banks are needed to make the euro zone resilient and to complete the Banking Union. It is a matter of sovereignty.
Finally, he concluded that supervision is therefore a political issue, and the political authorities must play a role. Echoing the remarks made by President Macron during his campaign, Benoit reiterated the point that prudential rules should be raised at European level by the ministers of finance at the Ecofin meetings.
La FBF participait au Forum financier Paris Europlace du 12 juillet 2017