What we learned from the crisis last fall is that markets that previously did not move together can suddenly do so, reversing trends that had been under way for several years. Moreover, we became aware that liquidity in even the most widely traded securities can be interrupted, primarily when many traders attempt to enter or exit positions at the same time. Thus, simultaneous stress testing across diverse fixed-income portfolios may help to identify high-risk market scenarios. Finally, I am convinced that there is a need for improved disclosure. In my view, the transparency derived from more open disclosure of risk management practices, risk profiles, and risk management performance cannot help but facilitate market discipline. Timely disclosure of such information would enable market participants to better assess how much risk market participants are taking, how well they manage it, and how much capital and liquidity they may need to survive adverse markets. BIS Review 8/1999  –5–  The desirability of improved disclosure is made clear in a report issued by the Basle Committee on Banking Supervision in September on enhancing bank transparency. This report set out a framework for the disclosure of key risks and performance measures for banks. In my view, the availability of more detailed data on international exposures would enhance the ability of both supervisors and counterparties to assess the vulnerability of domestic banks and banking systems to financial shocks from abroad.
To ensure they can durably provide their essential services to the economy, French banks need to generate sufficient revenues, without being subjected from different sides to ever-increasing constraints. With regard to insurance, the industry has entered the current crisis in a strengthened position. In a period marked by renewed interest rate cuts, insurers’ solvency capital requirement coverage ratio stood at 265% at end-2019, up from 239% at end-2018. But I shall let Bernard Delas go into more detail on that subject. In parallel, financial institutions have had to adapt their business models to two long1/3  BIS central bankers' speeches  term challenges: Low rates, which are now likely to be with us for the long haul, place pressure on banks’ and insurers’ profitability. In this context, banks are being aided by the tiering mechanism introduced by the ECB in September 2019, and insurers by the inclusion of part of their provision for profitsharing, which boosted their solvency ratios by an average of around 30 percentage points at end-2019. Digitalisation is allowing other economic players, including the Big Techs, to offer activities that were traditionally the preserve of the banks. The competition is welcome, but it needs to be fair. The ACPR is continuing to ensure that the regulatory and operational frameworks foster innovation while at the same time controlling the associated risks, notably cyber risks, which have increased markedly, and the challenges for European sovereignty. II.