François Villeroy de Galhau: Financial regulation - a French perspective

Speech by Mr François Villeroy de Galhau, Governor of the Bank of France, at the Financial System Conference 2022, Dublin, 2 November 2022.

The views expressed in this speech are those of the speaker and not the view of the BIS.

Ladies and Gentlemen,

I am delighted to be here in Dublin, and I would like to thank warmly Governor Gabriel Makhlouf for the invitation to speak today at this Financial System conference. I have already had the pleasure of coming here four years ago, to talk about Financial Globalisation and more specifically about current account imbalances and the resulting financial vulnerabilities. These topics have faded into the background for some time as a result of the unprecedented succession of shocks and crises. But financial stability is obviously returning to the front stage in these turbulent times, putting to the test the reforms undertaken over the last decade, but also pointing to new pockets of financial stress. Against this backdrop, I will reflect on the possible end of a favourable decade for financial regulation and financial stability (I). I will then focus on the real estate sector – so sensitive here in Ireland – as a practical study case of the progress enabled by our regulatory and macroprudential toolkit (II).

I. The end of a favourable decade for financial regulation and financial stability?

a. Financial regulation

It has now been fifteen years since the onset of the Great financial crisis – no need to recall the social, economic and financial damage incurred. But lessons were learned. A favourable era for financial regulation followed. This momentum was spurred by revived international cooperation at the highest level, with the milestone G20 Summits in 2009 and 2010 – the political laboratory of the following financial reforms.