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Banks and Insurance: CCSRS Analyzes Sectors

Taking stock of the inter-authority roadmap for financial stability for the period 2016-2018, at its 8th meeting, the Committee for Coordination and Surveillance of Systemic Risks (CCSRS) concluded that the banking sector managed to generate a net increase in net income for the first half of 2018, mainly reflecting an increase in net banking income combined with an improvement in the balance of non-current income.

In addition, banks continue to achieve solvency ratios above regulatory minima and are resilient to stress tests simulating a deterioration in macroeconomic conditions. They remain, however, exposed to concentration and interest rate risks, which are, for their part, subject to special monitoring.

The insurance industry continues to be strong. At the prudential level, the coverage rates of technical liabilities by investments made by insurance and reinsurance companies remain above regulatory minima. As a result, the sector continues to generate a solvency margin, in excess of the underwriting risk, well above the regulatory minimum required.

Nevertheless, the move towards the risk-based solvency regime, in application of the latest amendment of the Insurance Code, will probably lead to a significant reduction in the surpluses of this margin.

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