faced with such developments, it would be prudent to strengthen further the resilience of the global financial system. [ slide 3 ] i would argue that macroprudential policy has a key role to play to address the immediate concerns and is one critical element in strengthening resilience further. macroprudential authorities can seek to prevent an acceleration of the financial cycle. or, with more reasonable ambitions, to contribute to limit the formation of “ lumps of risks ”. the most ordinary macroprudential intervention relies on communication. by reminding time and again of the possible pitfalls of leveraging up and becoming complacent about risk taking, we seek to prompt second thoughts and ensure that risks are effectively understood, adequately priced and sensibly managed. if it starts with communication, macroprudential policy in this respect can also go further. indeed, this preventive reasoning led the hcsf, the french macroprudential board, to limit the main french banks ’ exposure to large “ highly indebted firms ” : by making it more difficulty to an already heavily indebted corporate to take on even more debt, the aim is to restrain the development of a segment of overstretched large firms. but the main objective of macroprudential authorities and an easier one to achieve should be to strengthen the resiliency of the financial sector when things are going well to allow it to withstand the shocks that will eventually hit. this is the rationale behind the ccyb. we do not intend to curb the overall credit growth. rather, as jfk once said, “ the time to repair the roof is when the sun is shining ”. by setting the ccyb rate above zero now, we lock in existing excess capital at a time it is relatively cheap ( in good times, retain earnings is the main driver of capital increase and the impact of a higher capital requirement on credit and the economy at large is limited is the current circumstances ) to be able to absorb futures losses and loosen the regulatory requirement at a time capital is scarcer and the macroeconomic impact of a gap would be significant. 3 / 4 bis central bankers'speeches a number of european countries have taken similar steps to increase their room for manoeuver ahead of a possible future storm. in that context, macroprudential policy is often described as a complement to monetary policy : a policy necessary to remedy the financial stability consequences of very accommodative monetary policy.

of “ alternative asset classes ” ( which the hotly debated clo market is an emblematic yet tiny part ) and the rising exposure of institutional investors toward “ real assets ”. such developments are indeed useful and welcome. however, the large shift in allocations toward these assets classes and the more general increased risk appetite driven by the current macrofinancial environment are not without risks : on the equity market, valuations can be stretched and mainly responding to financial developments rather than macro or fundamental factors as we have seen over the past few months when the late 2018 correction “ corrected ” quickly in 2019 ; similarly, after a ( modest in a longer - term perspective ) increase in late 2018, risk premia in the bond and credit market are compressed back to their historically low levels. losing sight of fundamentals while your risk tolerance is at its highest and you have grown accustomed to suppressed volatility can foster difficulties ahead when adjustments would have to be made. these two trends, non financial actors leveraging up and greater risk taking by financial institutions, are indeed global trends. within the euro area, credit distribution ( bonds and loans ) to the private sector has remained the most dynamic in france, resulting in a gradual but persistent increase in debt ratios. 2 / 4 bis central bankers'speeches more recently, credit has been getting some traction in other economies so that french developments may be informative of forthcoming developments elsewhere. in all cases, the concern is less about an immediate risk that one regarding the sustainability of the current developments. these are indeed medium - term trends deserving serious attention alongside other medium - term developments such as digitalization or climate change. the former ( digitalization ) hold very promising prospects in terms of efficiency, inclusiveness and quality of consumer services, etc. it is also a formidable challenge for the incumbents, threatening established positions and questioning business models. depending on the reactivity of the various stakeholders, ( traditional financial institutions, new players, established players in other sectors making a foray into financial services, regulators, etc. ), this challenge can be satisfactorily overcome or leave the whole financial system in a rather precarious situation. the latter ( climate change ) is a tremendous challenge that will contribute to reshaping the global economy and, more broadly society. this challenge is so significant that it is bound to have consequences for the financial system both as a risk concern and as a business issue. ( 2 ) strengthening the resilience of the global financial system