NEWS & EVENTS 2012
April 19, 2012:
Presentation given by Didier Davydoff at the AFGAP
Didier Davydoff gave a presentation at a breakfast held at the Association de la Gestion Actif Passif (AFGAP, the Asset Liability Management Association) on April 19, 2012. The presentation compared the number of savings transfers made by savers from life insurance companies to banks.
For more information, read the presentation (French only)
April 2012:
The AMF publishes its first "Letter from the Observatory of Savings"
The Autorité des Marchés Financiers (AMF) published its first "Letter from the Observatory of Savings", which includes the tariffs of financial products. At the end of 2011, the average cost of buying and selling Euronext Paris shares on the internet from large networks amounted to, on average, 7.40 € for an order of 1,000 €, 25 € for an order of 5,000 € and 47 € for an order of 10,000 €. Custody fees for Euronext Paris listed share portfolios were on average 77 € per year for a portfolio of 10,000 € with 10 different shares and 145 € for a portfolio of 50,000 €. The Total Expense Ratio (TER) of French UCITS was, on average, 1.64% of the outstanding amount in 2010, with a maximum of 2.39% for European shares funds and a minimum of 0.30% for monetary funds.
For more information, download the AMF letter (French only)
April 4, 2012:
Conference on Long-Term Savings organized by the FFSA and the ANIA
The Fédération Française des Sociétés d'Assurances (FFSA) and Italy's Associazione Nazionale fra le Imprese Assicuratrici held a conference on long-term savings. Bernard Spitz was able to show, using statistical analyses provided by IODS, that the main characteristics of savings in Italy and France were similar, except for the prevalence of Italy's household bond portfolios. In France, bonds are more usually held in life insurance contracts.
During the conference, Gilles Benoist, CEO of CNP Assurances, expressed a need for a modification to the IFRS accounting rules. He gave the example of "strategic participation" that would allow insurance companies to invest in equity without excessive costs in the Solvency 2 directive. Current accounting regulations do not, however, allow this.
For more information: See the presentation, visit the FFSA website (French only)
March 27, 2012:
Conference on High Frequency Trading
The EIFR (European Institute of Financial Regulation) organised a conference on ‘Market Imperfections and the Profitability of High Frequency Trading: Issues and Limits'. Frédéric ABERGEL, Director of the laboratory of Mathematics Applied to Systems at the Ecole Centrale Paris, presented research currently being conducted on the profitability of high-frequency trading activity (HFT). Laurent Grillet-Auber, Senior Economist at the Autorité des Marchés Financiers, provided an overview of high-frequency trading strategies and their impact on markets. HFT strategies generally involve reduced capital commitments because positions close on a daily basis. They are based on automated order flows and are supported by a heavy infrastructure and represent over 50% of equity transactions in the United States. The strategies employed fall into two categories: market making and arbitrage. The overall effect of individual strategies can create risk. Quote stuffing has a misleading effect on the market. The intermediary and the supervisory authority must therefore implement appropriate risk controls, which is, however, difficult in the absence of a mechanism that reliably records over-the-counter transactions. These negative factors raise the question of the optimality of huge investments in trading infrastructure brought about by HFT.
For more information, read Laurent Grillet-Aubert's presentation (French only)
March 14, 2012:
OEE Conference: "What place for structured products in private savings?"
The availability of structured products to European savers has diversified considerably in the last 15 years and the engineering of certain products is highly sophisticated.
How can we accommodate the complexity, protection, transparency and pricing of these products? Philippe Bertrand and Jean-Luc Prigent conducted a study for the OEE that evaluated the price of products offered to savers in relation to the guarantees made available.
Research by Claire Célérier and Boris Vallée sheds light on the "industrial economy" of structured products. Topics covered included whether complexity and innovation cater more to the exposure and protection of savers or to their behaviour, or whether they are result of intermediaries responding to the sophistication of some of their clientele.
Pierre Bollon then opened the discussion by raising questions concerning the role of intermediaries, including the contributions made by financial experts, exposure to risks (and protecting clients from them) and the adequacy of information and/or advice.
At the close of the conference, Jacques de Larosière used the example of structured products to speak about the place of banks today, which is currently under scrutiny in the US following the Volcker rule, the UK by the Vickers report and in Europe. He believes it is necessary to re-evaluate which operations banks can and should carry out, including those for private accounts, so that the client is put first.
February 16, 2012:
The End of the Dictatorship of Markets
Jacques de Larosière, President of the OEE, opened the conference ‘The End of the Dictatorship of Markets?' on February 16, 2012, which was organised by NYSE Euronext and Cercle des Economistes. His address described the symptoms of excessive inflation in the financial domain and attributed them to monetary, budgetary and regulatory causes plus those relating to the functioning of markets. He proposed a number of solutions that would "put the tigers back in their cage".
For more information, read Jacques de Larosière’s address (French only)
January 21, 2012:
European Savings Trends on France Info
Didier Davydoff, Director of the Observatoire de l'Epargne Européenne, was invited by Marie-Christine Vallet to discuss recent European savings trends. Didier Davydoff highlighted the difference in saving behaviour seen in Germany, where unemployment is low and therefore allows more spending, with that of other European countries, where levels of unemployment are much higher, which in turn encourages precautionary saving.
Listen to the programme (French only)
January 10, 2012:
La Banque Postale Publishes its Annual Savings Barometer
A telephone survey was conducted by TNS Sofres on a representative sample of the French population, with participants ranging from 18 to 80 years of age, for La Banque Postale and newspaper Les Echos. 76% of those who took part said that if they had money to invest, they would prefer to invest it in savings accounts, while 48% said they would invest in life insurance. Only 12% were willing to invest in shares, with 60% of those questioned believing such an investment to be too risky, notably a larger percentage than that seen at the end of 2008. The perception of risk with regard to bonds was also considerably higher than previously seen, with 44% of participants believing them to be too risky, and only a mere 9% willing to invest in them.
The survey also revealed that those saving for retirement preferred to invest in property (44%) as opposed to life insurance (37%).
For more information, click here (French only)
