##pr. this would be the trade - off for the continuity thus provided. ii. beyond brexit, building a financial eurosystem clearly, brexit is, and will remain, bad news not only for the united kingdom, but for europe as well. but to a certain extent it can also represent an opportunity to restructure the european financial system. we have an effective monetary eurosystem consisting of the ecb and the 19 national central banks ; we have the legal framework for a single financial market and – in part – a banking union ; we have an exceptional savings capacity – one of the highest in the world – with an annual flow of eur 400 billion in euro area financial savings in the second quarter of 2018. 2 however, as yet we do not have a “ financial eurosystem ”, made up of stronger and paneuropean financial institutions and shared market infrastructures. let ’ s be clear : there will not be a single city for the continent, but rather an integrated polycentric network of financial centres, with specialisations based on areas of expertise. a polycentric system of this nature can function, as illustrated by the united states : new york ’ s financial centre is favoured by corporate and investment banks, chicago ’ s financial centre handles futures, while boston specialises in asset management. paris is well qualified to become the “ market hub ” of this new european constellation. our capital hosts four of the euro area ’ s eight global systemically important banks, the top life and non - life insurance sector and asset management industry, one of the leading bond markets and the largest continental commercial paper market with neu - cp. it is also the biggest private equity investor in continental europe. in addition, the french financial authorities, including the banque de france and the acpr, are working together to facilitate the dissemination of sound and safe financial innovations and to foster the scaling up of sustainable finance. moreover, paris offers the leading source of highly qualified financial services personnel. consequently, many global banks have already decided to transfer the majority of their market activities to paris. this new system will require a single rulebook implemented in a harmonised manner. and we are close to achieving it in the banking sector, but we are not quite there in the insurance sector. it is thus necessary to further strengthen the role of the european supervisory authorities, and france supports – although it remains a little too alone in doing so – the commission ’ s proposed reform of the esa

francois villeroy de galhau : the consequences of brexit for the french and european financial sectors speech by mr francois villeroy de galhau, governor of the bank of france and chairman of the autorite de controle prudentiel et de resolution ( acpr ), at the acpr conference, paris, 23 november 2018. * * * ladies and gentlemen, i am delighted to welcome you along with bernard delas to this new conference organised by the acpr, which this morning will focus on the consequences of brexit for the financial sector. this issue is admittedly constantly evolving in line with current events... i welcome the agreement that was reached between the european negotiators and their british counterparts last week and we all hope that it will pass through the stages to come and ultimately be finalised. however, in a context that remains uncertain, we must be cautious : even if we hope to avoid it, we must also be ready for a possible no deal scenario. the acpr and the banque de france are preparing for this eventuality to ensure the smooth functioning of the financial system. that will be my first point and for that reason i will discuss it using the conditional. i would then like to look beyond brexit to see how we can transform some of today ’ s difficulties into opportunities for the future and build a more integrated “ financial eurosystem ”. * * i. in the short term, effectively manage the risks of brexit as part of their tasks, the acpr and the banque de france closely monitor two main types of risk associated with the prospect of brexit : those that could threaten financial stability and those that could undermine customer protection. it is important to avoid the cliff - edge that would arise from a no deal brexit. the economic consequences would naturally be far more serious for the united kingdom than for the rest of the european union. at this stage, our analysis, like that of the ecb, which as you know jointly carried out an in - depth technical study with the bank of england, has not identified any major risks to financial stability. in the words of mr draghi : “ it would really take an extraordinary amount of lack of preparation to materialise the financial stability risks that might come from a hard brexit. 1 the clearing of interest rate derivatives nevertheless deserves particular attention, as the uk clearing houses have a virtual monopoly in the sector. in the event of a