By William Horobin and Noemie Bisserbe
PARIS--Bank of France governor Christian Noyer said Tuesday that
market volatility still poses a risk to the financial system,
particularly as low interest rates weigh on banks' profits.
Presenting the annual report of France's banking supervisor
ACPR, Mr. Noyer called for strengthened vigilance of the risks
weighing on the banking sector.
"I'm thinking in particular of the volatility we've seen on
markets in a context where there is limited liquidity in many
cases, and in a context of very low market interest rates," Mr.
Noyer said.
Mr. Noyer, who is also president of the ACPR, said low interest
rates have a particularly negative impact on French banks' margins
because rates banks pay on state regulated deposits haven't fallen
enough. He also said a rise in borrowers renegotiating mortgages in
France is weighing on banks' margins.
-Write to William Horobin and Noemie Bisserbe at
william.horobin@wsj.com; noemie.bisserbe@wsj.com