Financial Regulation and Governance


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Debt designed to be stolen.
A new way to embezzle public money?

By François Valérian
November 2020
On October 22, 2020, Goldman Sachs entered into a settlement with the U.S. Department of Justice to end the lawsuit against the bank in connection with the Malaysian "1MDB Fund". Two figures in the agreement may seem surprising. Goldman Sachs and its business partners allegedly paid $1.6 billion in bribes to obtain $606 million in fees on transactions. ...
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Digital agility in financial firms

By Emmanuel Yoo
February 2019 - Réalités Industrielles
Agile methods appear to be the new paradigm for banking. According to most banking organisations, agility is now the key issue. This enthusiasm is attributable to the promised benefits of agility, which make it a workhorse in terms of internal communication and to attract new talent. However, implementing agile methods means defining new operating modes and ...
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The banking sector,
in the midst of a transformation

By Nicolas Denis
February 2019 - Réalités Industrielles
The banking sector is in the midst of a period of transformations. Facing stiff competition in its historical markets and business lines, it must understand and respond to the challenges of reinvention, while also developing its status as a trusted third party. In this era of commoditisation and lack of trust, banks and the banking profession in general must transform themselves ...
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Investment banking:
New paradigms and new forms of technology

By Laurent-Olivier Valigny
February 2019 - Réalités Industrielles
The Nora-Minc report on the computerization of French society — now more than forty years old — prophetically compared banks to “tomorrow’s iron and steel industry” as it discussed a saturated market, production overruns, insufficient equity, production costs and disruption due to telematics and computers. The current digital revolution has overtaken ...
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Margo Bank, a European bank
for new generation SMEs

By Jean-Daniel Guyot
February 2019 - Réalités Industrielles
Margo Bank is striving to set up a responsive and human bank that uses technology to bolster customer relations. To better address the financial support and digital transition issues faced by European SMEs, three entrepreneurs have decided to build a new bank from scratch.
By building its own tech stack and recasting its organisational structure and processes, ...
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Big data in the banking universe

By Laurence Le Buzullier
February 2019 - Réalités Industrielles
The web giants have revolutionised the use and storage of data: big data.
Nowadays, all data is saved in “data lakes”. These enormous containers of structured and unstructured data (such as videos and text) replace the former data warehouses. The cloud enables access to such huge volumes of data, while also reducing the technology costs borne by companies. ...
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New challenges for financing the economy

By Marie-Anne Barbat-Layani
August 2018 - Réalités Industrielles
Contrary to other euro area countries, the credit crunch overlooked France during the financial crisis. Levels of access to credit remained very high, backed by positive lending conditions. France was also the sole euro area country where the taxpayer was spared the cost. French banks weathered the crisis well, enjoying higher and less volatile returns than those of their European ...
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Banks since the meltdown

By Jean Beunardeau
August 2018 - Réalités Industrielles
In general, economic and banking crises are triggered by the financing of unprofitable investments, which result in credit losses. The 2008 financial meltdown was no exception and, owing to its severity, governments and regulatory authorities had to recast the banking industry’s regulatory framework. This involved higher prudential ratios, amended rules for the calculation of ...
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The Cost of Regulation

By Michala Marcussen
August 2018 - Réalités Industrielles
Tighter regulation inevitably carries a cost, but must be weighed against the benefits of greater financial stability. Estimating net benefits is, however, a complex exercise and while consensus is that in aggregate these remain positive, gains could be made by improving efficiency and addressing leakages. Moreover, structural reform, and not least completing the European Banking and ...
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Fiscal innovation to make European banks
more stable and competitive

By Michael Tröge
August 2018 - Réalités Industrielles
Following a series of tax and accounting reforms since the 1980s, the corporate tax system now favours debt financing. This pro-debt bias forces banks, in particular, to take on very high levels of debt to remain competitive. Recent empirical research has shown that this mechanism is one of the primary causes of the financial system’s weakness. However, there are simple tax or ...
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Bank capital and RoE: erroneous beliefs
and financial instability

By Christophe Moussu
August 2018 - Réalités Industrielles
Since the crisis, banks’ beliefs regarding optimal capital levels and performance objectives have clearly not changed significantly. Yet a substantial body of academic research on bank capital has shown that the banks with the highest capital levels are more resilient to shocks, are more efficient, gain more market share and command the highest valuations ...
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The introduction of cognitive technology
at Crédit Mutuel

By Frantz Rublé
March 2018 - Digital Issues
Even as the digital transition is changing the behavior patterns of its shareholding customers, as its account advisors need everyday assistance in order to provide better services to customers, and as the first cognitive computing solutions based on IBM’s Watson technology are emerging, the Crédit Mutuel, a mutualist bank in France, is working with IBM to develop the first AI ...
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A whale in shallow waters:
JPMorgan Chase, the “London Whale”
and the organisational catastrophe of 2012

By François Valérian
November 2017 - Réalités Industrielles
The case of the so-called “London Whale” cost US bank JP Morgan Chase & Co. more than $6bn. The hearings held by the United States Senate enabled this case to be carefully documented, and shed light on the errors committed by an organisation that believed it was implementing an innovative, profitable hedging strategy – but was actually taking risks that were significant and very poorly....
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Orange Bank:
The first telecom-bank

By Jean-Bernard Mateu
November 2017 - Réalités Industrielles
In a rapidly-changing world of banks, customers and technology, the Orange Group decided to launch a native mobile banking system that offers an incomparable user experience. To do so, Orange was able to draw on a set of unique strengths: a strong brand that embodies key values such as security and reliability, a solid distribution network, the Group's capital base and, ....
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Vulnerable populations:
An overview of La Banque Postale's experience providing universal banking accessibility

By Didier Brune
November 2017 - Réalités Industrielles
Like all other banking institutions, La Banque Postale is seeing fewer clients coming into its branch offices, as people nowadays carry out most of their daily financial transactions remotely, using their smartphones, and are using cash less and less.
Yet thanks to its easy accessibility, its strong foothold in underprivileged suburban neighbourhoods, ...
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The UN’s Sustainable Development Goals
(SDGs) and the financial sector:
CDC’s experience

By Maria Scolan
October 2017 - Responsabilité & Environnement
The UN’s Sustainable Development Goals (SDGs) provide a universal approach to what Caisse des Dépôts (CDC) refers to, in the French tradition, as the “public interest”. This framework adopted by the international community provides CDC, as a public financial institution, with an opportunity to develop its own evaluative culture of its socio-economic impact. CDC’s role also entails ...
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The Icelandic financial crisis
and self-fulfilling prophecies:
Chronicles of a prophesied bankruptcy

By François Valérian
August 2016 - Réalités Industrielles
The meltdown of the three major Icelandic banks in the autumn of 2008 has been set down to phenomena as varied as: bloated assets in financial statements, “adventuresome” deregulation, inadequate supervision, the banks' poor governance, weak ethics, a macroeconomic disequilibrium and the lack of international cooperation. As a review of more than a hundred reports, ....
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The majority of the articles published here were translated from French to English by the Translation Centre of the French economy and finance ministries.
The remaining articles were translated by Noal Mellott.

Mise à jour le 26 novembre 2020

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