Corporate debt remains the main risk for the financial system

For the Banque de France, the weight of corporate debt, which has increased significantly since the crisis, is the main factor of instability for the financial system. The slowness of the recovery, while the epidemic is struggling to be contained, poses a real risk to the profitability of banking institutions.

Between February and September 2020, the amount of corporate debt increased by 174.5 billion euros, including 120.7 billion for loans guaranteed by the State alone.

The risk is known, but it is nonetheless significant. The Banque de France again alerted this Thursday to the deterioration in the financial situation of companies, targeting debt as the main risk weighing on the French financial system at the start of 2021.

And this risk could increase further in the next six months, according to the semi-annual report published by the supervisor. ” The gross indebtedness of non-financial corporations (SNF), which rose sharply in the spring, is expected to remain high as long as the health crisis lasts », Recognizes the Bank of France.