{
  "title": "France: Financial Sector Assessment Program-Technical Note-Macroprudential Policy Framework and Tools",
  "publication": "IMF Staff Country Reports, October 29, 2019",
  "sourceUrl": "https://www.imf.org/en/publications/cr/issues/2019/10/28/france-financial-sector-assessment-program-technical-note-macroprudential-policy-framework-48763",
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  "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.",
  "sections": [
    {
      "heading": "Key findings",
      "content": "- 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.\n- The HCSF should evaluate effects of tools introduced to mitigate risks from corporate leverage.\n- 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:\n  - resilience of the financial system; and\n  - corporate borrowing behavior.\n- A sectoral systemic risk buffer, calibrated to corporate exposures, could be considered if vulnerabilities intensify.\n- A fiscal measure that incentivizes corporates to finance through equity rather than debt would affect both bank and market-based finance and would have an impact on the demand for credit, rather than its supply.\n- The macroprudential policy toolkit should be strengthened further."
    },
    {
      "heading": "Policy recommendations and considerations",
      "content": "- Evaluate effects of corporate-leverage mitigation tools once sufficient data is available.\n- Continue monitoring corporate-sector vulnerabilities to assess need for additional macroprudential measures.\n- Consider implementing a sectoral systemic risk buffer calibrated to corporate exposures if vulnerabilities intensify.\n- Consider fiscal measures that incentivize corporate equity financing to influence demand for credit across bank and market-based finance.\n- Strengthen the macroprudential policy toolkit to bring remaining tools within the HCSF’s legal domain or to improve coordination."
    },
    {
      "heading": "Scope and thematic coverage",
      "content": "- Subject labels: Financial institutions; Financial sector policy and analysis; Financial sector stability; Insurance companies; Macroprudential policy; Macroprudential policy instruments; Systemic risk.\n- Keywords include: 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.\n\n---\n\n Content in this bundle\n\n- Executive Summary\n  - Executive Summary (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Executive Summary (PDF){rel=\"external\" type=\"application/pdf\"}"
    }
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    "Published: October 29, 2019",
    "Series: IMF Staff Country Reports",
    "DOI: https://doi.org/10.5089/9781513517803.002",
    "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 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:",
    "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 and would have an impact on the demand for credit, rather than its supply.",
    "The macroprudential policy toolkit should be strengthened further.",
    "Evaluate effects of corporate-leverage mitigation tools once sufficient data is available.",
    "Continue monitoring corporate-sector vulnerabilities to assess need for additional macroprudential measures.",
    "Consider implementing a sectoral systemic risk buffer calibrated to corporate exposures if vulnerabilities intensify.",
    "Consider fiscal measures that incentivize corporate equity financing to influence demand for credit across bank and market-based finance.",
    "Strengthen the macroprudential policy toolkit to bring remaining tools within the HCSF’s legal domain or to improve coordination.",
    "Subject labels: Financial institutions; Financial sector policy and analysis; Financial sector stability; Insurance companies; Macroprudential policy; Macroprudential policy instruments; Systemic risk.",
    "Keywords include: 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.",
    "**Executive Summary**"
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