The Haut Conseil de stabilité financière (HCSF – High Council for Financial Stability) is the French macroprudential authority tasked with “supervising the financial system as a whole, with the aim of safeguarding its stability and ensuring a sustainable contribution of the financial sector to economic growth”. (article L.631-2-1 of the French Monetary and Financial Code).


Its mission is to help to mitigate and prevent systemic risks, which can be defined as a risk of widespread disruption to the provision of financial services caused by an impairment of all (or a large part) of the financial system, and which has the potential to have serious negative consequences for the real economy. In order to achieve this goal, the HCSF has adopted a series of five intermediate objectives which guide the operational implementation of its macroprudential policy:

  • To mitigate and prevent excessive credit growth and leverage;
  • To limit overreliance on short-term funding or excessive maturity/risk mismatch and mitigating market illiquidity;
  • To limit direct and indirect exposure concentrations (either in the form of interlinkages between financial sector participants or the exposure of several participants to a shared risk factor);
  • To limit the systemic impact of misaligned incentives with a view to reducing moral hazard (including by increasing the resilience of systemically important institutions which, where appropriate, can be combined with the implementation of orderly bankruptcy and resolution regimes for failed banks, in order to reduce their systemic nature); and
  • To strengthen the resilience of financial infrastructures.

The HCSF is also responsible for facilitating cooperation and exchange of information between the institutions that its members represent. This cooperation is one of the key elements of an efficient supervisory and regulatory framework. It helps to eliminate blind spots in the financial supervisions, and allows for a better oversight of risks arising from interlinkages between participants/sectors and interactions between regulations.

The HCSF meets at least four times a year and submits a publicly-available annual report to the French Parliament.

Macroprudential Toolkit

In order to achieve its ultimate objective and prevent emergence of systemic risks, the HCSF has three types of macroprudential instruments which complement each other:

  • “Soft” interventions (communication, issuance of opinions …) which allow the HCSF to signal potential risks and to coordinate people’s behaviours;
  • “Intermediate” interventions (formulation of recommendations), which requires a response or a formal action from a third party; and
  • “Hard” interventions, where the HCSF exercises its legally binding powers.

Among its binding powers, the HCSF can, on a proposal of the Governor of the Banque de France, decide to:

  • Activate the systemic risk buffer. The aim of this buffer is to increase financial system’s resilience during a crisis and thus allow financial institutions to meet their obligations;
  • Activate a countercyclical buffer. This buffer is designed to limit the impact of financial cycles. This buffer rate changes with the economic situation: it should increase in times of economic growth and decrease during the downturns in order to smooth down the credit cycle;
  • Use the instruments provided for in article 458 of the n° 575/2013 (EU) regulation from the European Parliament and of the Council of 26 June 2013: when a variation in the intensity of the systemic or macroprudential risk has been identified, tougher national measures can be implemented concerning pillar I requirements, requirements for large exposures, public disclosure requirements, the level of the capital conservation buffer, liquidity requirements and risk weights for targeting asset bubbles in the residential and commercial property sector;
  • Finally, the HCSF can set credit standards for lending in order to moderate and prevent excessive credit growth and leverage.

The HCSF bases its decision-making on the principle of guided discretion, where a set of rules and indicators are used to signal what kind of adjustments might be necessary, but the authority exercises its own judgement when making its final decision, taking into account all the available information.

European Framework

The HCSF’s action is part of a broader European framework. Its decisions are taken in collaboration with the European Commission, the European Central Bank (ECB), the European Systemic Risk Board (ESRB), the European Banking Authority (EBA), and the macroprudential authorities of the other European Union Member States.

Composition of the High Council

The HCSF is composed by eight members: five ex officio members and three qualified members. The ex officio members are:

The three qualified persons are selected on the basis of their skills in the field of monetary policy, finance and economics. They are named for a five-year term by the Chairman of the French National Assembly, the Chairman of the Senate and the Minister of Finance and Public Accounts.