Regulation

French regulators to probe shadow banking risks

Watchdogs and central bank team up to look at how shocks from so-called non-bank financial institutions could ripple through markets

Top regulators in Paris want a ‘collaborative’ exercise with financial services firms
Top regulators in Paris want a ‘collaborative’ exercise with financial services firms Photo: Getty Images

French authorities are preparing to review how the rise of shadow banks could impact the resilience of markets, Financial News has learned.

The country’s central bank and regulators are trying to get a handle on how an economic crisis might spread from so-called non-bank financial institutions — ranging from private markets firms to hedge funds and pension providers — to mainstream finance given their increasing ties to the real economy.

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