The president of the French Banking Federation Philippe Brassac assured on Saturday March 18 that the current banking turmoil in the world, which is hitting Credit Suisse in particular in Europe, was not likely to contaminate the banking sector in France.
“There is no risk because there is no possible contagion mechanism between the events we are seeing and the French banks”said the banker, managing director of Crédit Agricole, on France Inter. “French banks are very solid due to regulation” et “there is no mechanism, as there could be in the past, of propagation”.
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“The failure of Silicon Valley Bank is likely to have a snowball effect on all economic activity”
“French banks are solid”repeated the Minister of the Economy Bruno Le Maire. “Savers don’t have to worry about their deposits. We have in Europe the most demanding banking supervision system on the planet”he said in an interview with “Parisian” SATURDAY.
“Specific rules of caution”
Since the bankruptcy of Silicon Valley Bank (SVB) in the United States on March 10, and despite the lifelines of the Swiss and American authorities, the banking sector relapsed on the stock market on Friday, dragging all the markets into the red.
As in the past week, concerns focus on Credit Suisse, one of 30 banks globally deemed too big to fail and which could be taken over in whole or in part by Switzerland’s largest bank. , UBS, from this weekend, in order to stop the panic.
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“Almost all French banks are subject to specific prudential rules”such as capital requirements, liquidity, interest rate risk management, listed the representative of French banks.
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The difficulties of Credit Suisse “known for a long time”
“With respect to American banks, there is no link between the balance sheets”and regarding Credit Suisse, “there is no possible contamination”, continued Philippe Brassac. In effect, “Since 2008 (…), the big banks no longer have the ability to link up with each other through monetary loans as we did in the past”he further explained.
“For Credit Suisse, its difficulties have been known for a long time”declared the French Minister of the Economy who said he was waiting “a definitive and structural solution to the problems of this bank”.