Bank of France with ACPR and AMF launches first system-wide exploratory stress test on financial sector interconnections

The Bank of France, the French Prudential Supervision and Resolution Authority (ACPR) and the French Financial Markets Authority (AMF) have launched a joint exploratory “system-wide” stress test with leading French financial institutions to better understand how interconnections and interdependencies could amplify shocks and destabilise the financial system under market stress. More than 25 French institutions are participating, including all global systemically important banks established in France and a broad cross-section of banking, insurance and asset management. The exercise uses a scenario designed to replicate a severe market stress calibrated to exceed the worst two-week episode observed over the past 20 years, and participants will assess impacts and set out their likely responses, including liquidity management actions such as asset sales, borrowing, issuance and repo transactions. The initiative focuses in particular on bank and non-bank financial intermediation linkages, drawing on lessons from similar UK exercises conducted in 2023 and 2024. Responses will be consolidated in an initial analysis phase, followed by a second phase in the first half of 2026 focused on assessing interactions between actors and market reactions. A joint synthesis report is planned at the end of the work, and the authorities note the voluntary exercise will not affect the participants’ individual supervision.