France will require its largest banks to increase their capital buffers if they expand loans to large, highly-indebted companies, as regulators seek to clamp down on risks from the business of leveraged finance.
The French High Council for Financial Stability, known in France as HCSF, will implement a buffer equivalent to 3% of the relevant exposures if those assets surpass 5% of their equity, the body said in a statement on Tuesday. No French banks currently have an exposure beyond this threshold, an HCSF official said.
Read More : France Implements Buffer to Safeguard Banks from Exposure to Leveraged Companies