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France: Financial Sector Assessment Program-Technical Note on Supervision of Liquidity Risk in Investment Funds and the Oversight of Trading Activities

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  • International Monetary Fund

Abstract

This Technical Note focuses on Supervision of Liquidity Risk in Investment Funds and the Oversight of Trading Activities in France. Financial markets in France have evolved since the previous Financial Sector Assessment Program (FSAP), particularly in respect of wholesale markets. The responsibilities of regulators have also grown, with new obligations to supervise against matters such as digital asset markets, sustainable finance, and digital operational resilience. French authorities have responded well to these changes and supervisory approaches are high quality and effective. Inter-agency cooperation and supervision operates effectively but sometimes informally. The Autorité des Marchés Financiers (AMF’s) supervisory approach to managing liquidity risks in open-ended funds is proactive and should continue as incoming EU level changes amend requirements. The AMF has responded well to changes in trading activities and should continue to invest in supervision of market oversight and resilience. Markets and regulatory risks have changed since the previous FSAP, including a material increase in over-the-counter trading, and in some markets a move away from continuous intra-day liquidity toward point-in-time liquidity concentration, for example, in trading auctions.

Suggested Citation

  • International Monetary Fund, 2025. "France: Financial Sector Assessment Program-Technical Note on Supervision of Liquidity Risk in Investment Funds and the Oversight of Trading Activities," IMF Staff Country Reports 2025/240, International Monetary Fund.
    • Handle: RePEc:imf:imfscr:2025/240
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