presentation of the 2021 annual report of the autorite de controle prudentiel et de resolution ( acpr ) press conference, 31 may 2022 speech by francois villeroy de galhau, governor of the banque de france chairman of the acpr press contact : mark deen ( mark. deen @ banque - france. fr ). page 1 of 8 ladies and gentlemen, i am very pleased to welcome you to our presentation of the annual report of the autorite de controle prudentiel et de resolution ( acpr – prudential supervision and resolution authority ), in the company of jean - paul faugere, vice - chairman of the acpr, dominique laboureix, secretary general of the acpr, and alain menemenis, president of the sanctions committee. last year was marked by a vigorous recovery of our economy, during which our financial sector proved particularly robust ( i ). 2022 should now see substantial advances on the regulatory front ( ii ). however, the war in ukraine is posing new risks to the financial sector, calling for heightened vigilance ( iii ). in all these situations, the women and men of the acpr have worked tirelessly to ensure that the french financial system remains resilient under all circumstances, providing adequate financing to the economy. i would like to extend my warm thanks to them. * * i. the strength of the french financial sector is more than ever an asset for our economy i shall start with just a short word on the situation for insurers, which jean - paul faugere will go into in greater depth. in the context of the economic recovery in 2021, the insurance sector saw a return to growth in all its activities : net inflows increased by 18 % compared with the previous year. this allowed insurers to consolidate their solvency, with the average solvency capital requirement ( scr ) coverage ratio rising to 253 % after the slight decline seen during the covid crisis. page 2 of 8 french banks in turn saw a “ return to normal ” in 2021 in terms of dividend payouts, which was completely justified. their solvency ratio, which was already solid, increased even further over the year, reaching 16 % for the top six french banking groups. their profitability also improved ( their roe stood at 7. 1 % at end - 2021 compared with 4. 6 % a year earlier and 6. 4 % in 2019 ) : it

for them. the booklet explains such features as payment shock and negative amortization. it also provides numerical examples that illustrate how consumers'payments can change and how their loan balances may increase over the term of the loan. the federal reserve also published a consumer education brochure titled : interest - only mortgage payments and option - payment arms - - are they for you? the brochure is designed to assist consumers who are shopping for a mortgage loan and is available in printed form and in electronic form on the federal reserve ’ s website, along with other consumer mortgage information finally, the federal reserve engages in numerous outreach activities and conducts research to help us better understand the financial services market and consumer behavior and the best approaches for assisting consumers. we sponsor consumer and industry surveys, hold public hearings, discuss issues with our consumer advisory council, and conduct consumer focus groups and other types of consumer testing, in addition to considering the public comments on proposed rules. recently, the federal reserve has engaged in outreach to a broad group of interested parties regarding nontraditional mortgages. our consumer advisory council, which includes consumer advocates and industry representatives, provided us with valuable information about nontraditional mortgage products during development of the interagency guidance. in addition, the federal reserve held a series of four public hearings on home - equity lending during the summer of 2006. one of the principal purposes of the hearings was to gather information to inform the federal reserve ’ s review of its truth in lending rules. a significant portion of the hearings was devoted to discussing nontraditional mortgage products, and in particular, whether consumers receive adequate information about these products. the hearings explored research on consumer behavior in shopping for mortgage loans and included discussions about the challenges in designing disclosures to more effectively communicate loan terms and risks to consumers. we will consider this information in developing plans and recommendations for revising the truth in lending rules, which require all creditors to provide consumers with disclosures about loan terms. many financial products are very sophisticated credit transactions, and the disclosures describing them are also complex and highly technical ; which can be difficult for some consumers to understand. to address this issue, the federal reserve is focusing in a more rigorous way on determining the effectiveness of disclosures. we conduct extensive consumer testing to determine what information is most important to consumers, when it is most useful for consumers to receive it, what language and formats work best, and how disclosures can be simplified, and better organized, to reduce complexity and information overload.