Banking crisis: ‘no risk’ of contagion in France, industry federation claims

In the wake of the European Central Bank’s supervisors, the president of the French Banking Federation, Philippe Brassac, also wanted to reassure after the SVB bankruptcy and Credit Suisse’s historic stock market crash. Even if financial markets closed sharply lower on Friday (-1.43% in Paris), with Crédit Agricole dropping 2.2% in particular, Philippe Brassac believes the current banking turmoil is unlikely to pollute the market. sector in France.

“There is no risk because there is no possible contagion mechanism between the events we are seeing and French banks,” the banker, managing director of Crédit Agricole, told France Inter.

According to him, “French banks are very strong thanks to regulation” and “there is no distribution mechanism, as it could be in the past.” “Almost all French banks are subject to certain prudential rules,” such as capital requirements, liquidity, interest rate risk management, a representative of French banks listed.

Credit Suisse Concerns Remain

Unlike in 2008, Europe and the US reacted immediately to these tensions. In addition, “since 2008, large banks have no longer been able to communicate with each other through cash loans, as it used to be,” added Philippe Brassac.

Elsewhere, to curb inflation, the European Central Bank (ECB) raised rates again on Thursday and called a surprise meeting to discuss sector vulnerabilities.

However, concerns about Credit Suisse remain. It is considered one of the 30 banks in the world as too big to fail. This weekend, it could be turned over in whole or in part to the largest Swiss bank, UBS, to stop the panic.