page 1 sur 7 8th international insurance conference : “ towards the insurance of tomorrow ” – paris, 14 october 2016 speech by francois villeroy de galhau, chairman of the autorite de controle prudentiel et de resolution and governor of the banque de france ladies and gentlemen, i am very happy to be here today for this 8th international insurance conference - the first to be organised under the aegis of the french insurance federation - and i would particularly like to extend my regards to the federation ’ s chairman, bernard spitz, as well as to its vice - chairmen. although i have met you all several times in the past year, this is the first time i have participated in an event in my capacity as chairman of the acpr, the autorite de controle prudentiel et de resolution. rest assured that at the acpr, i indeed we - regard the insurance sector as every bit as important as the banking sector. with a total of 826 licensed firms in france in 2015, oversight of the insurance sector is a vital part of our mission to safeguard financial stability – which, alongside monetary strategy and the provision of services to the economy, forms part of my threefold mandate as governor of the banque de france. page 2 sur 7 as supervisors, we are concerned on a daily basis with the theme of this conference : the insurance industry of tomorrow. indeed, given the speed at which things are evolving, tomorrow ’ s insurance landscape is already very much present today. among the many changes you are being forced to adapt to – technological, environmental, macroeconomic and regulatory – i would like to look in particular at two key challenges : the persistent low interest rate environment, and the profound changes to the regulatory framework with the entry into force of solvency 2. * * i. first, the challenge of low interest rates on this issue, it is important not to lose sight of the broader picture : low rates are not solely the result of monetary policy, they are also a consequence of the global savings glut ; and the current low rate environment is not just having negative effects, it is also producing benefits that should not be underestimated. if the ecb had not acted to lower interest rates, we would have even lower inflation today – and the deadly threat of deflation - and less growth in france and europe. this would be detrimental for insurers as well as banks. in addition, low rates are having a direct positive impact on

key role in this process, with a blueprint expected to be published by the end of the year. at european level, the framework proposed by the pilot programme can support this common vision by enabling the use of new distributed registry technologies to be tested in regulated and secure environments. this framework is an opportunity for market participants to start anticipating and adapting their businesses. nevertheless, regardless of whether we are talking about multilateral trading facilities ( mtf ), securities settlement systems ( sss ) or a combined solution ( trading and settlement systems ), obtaining a licence is both a medium - and a long - term commitment. many players seem reluctant to take this step because of the uncertainty surrounding the future of a central bank digital currency settlement solution for tokenised assets. this uncertainty needs to be resolved and the authorities are working together to provide a clear perspective on what the central bank settlement solution will look like. in my view, a secure and liquid settlement asset available on the dlt is one of the keys to the success of the pilot programme. a cbdc - based solution would provide an important lever in supporting the transition enabled by the pilot programme, and we have already developed our own blockchain, dl3s, for this purpose. but trials are in progress and we shall see which solution is chosen. this european challenge is rounded out by an international challenge. it is vital that the french and european financial sectors are well represented in the experiments being conducted on a global scale, such as the work being carried out by the bank for international settlements. i am thinking in particular of the agora project, which focuses on cbdc and commercial bank money for cross - border payments. adequate representation of national players in these different projects page 4 of 5 is essential for defending our interests and ensuring that the international standards developed are in line with both our interests and our needs. b. setting priorities : maintaining the two - tier monetary system and modernising the market segments that are currently least well served [ slide 4 ] in this phase of the transformation, it is vital not only to cooperate but also to define clear priorities to guide the modernisation of our market infrastructures. the most important of these priorities is to retain the two - tier monetary system, in which central bank and commercial bank money each play a distinct but complementary role. this model has proved its worth in ensuring the stability and resilience of the financial system and must be preserved to help with the adoption of technological innovations without upsetting fundamental balances. at