François Villeroy de Galhau: Presentation of the 2018 Annual Report of the ACPR

Speech by Mr François Villeroy de Galhau, Governor of the Bank of France and Chairman of the Autorité de contrôle prudentiel et de resolution (ACPR), at the press conference, Paris, 28 May 2019.

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

Accompanying slides of the speech.

Ladies and Gentlemen,

I am pleased to welcome you to the presentation of the 2018 annual report of the Autorité de contrôle prudentiel et de résolution (ACPR), alongside Bernard Delas, Vice-Chairman of the ACPR, Rémi Bouchez, President of the Sanctions Committee, and Edouard Fernandez-Bollo, Secretary General of the ACPR. In 2018, the women and men of the ACPR continued to work tirelessly to safeguard financial stability, in a context marked by the uncertainty - and at times the emergency - of Brexit. I would like to thank them for their work. This morning, I shall focus on a topical issue - the profitability of banks and insurers in France and Europe.

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I. The profitability of French banks and insurers remains resilient

The return on equity of France's largest banks edged up by 0.4 percentage points to 6.7% in 2018, coming back in line with 2015's level. The maintenance of profitability levels needs to be viewed alongside the sharp rise in bank capital. French banks have strengthened their solvency and are now more robust. They have more than tripled their capital since the crisis. In parallel, they have raised their core capital ratios (CET1) by nearly 8 percentage points since 2008, from an average of 5.8% to 13.6% in 2018 [slide 3]. French banks' profitability is in line with the euro area average and well above that of their German counterparts. At an international level, only the US banks stand out as having an ROE in excess of 10%.