Commercial real estate: a risk for bank balance sheets

The exposure of French banks to commercial real estate increased before the crisis. However, this financing is partly guaranteed by assets whose value could deteriorate with the crisis, estimates the Banque de France.

The exposure of the five main French banking groups to real estate professionals had

Prevention is better than cure. In its annual financial risk assessment report, the Banque de France warns credit players: if the commercial real estate financing market is not large enough on its own to put banks in difficulty, “ it could nevertheless contribute, among other factors, to weaken their balance sheets and limit their ability to finance the economy ».

An assertion that is not to be taken lightly. Especially since the exposure of the five main French banking groups to the commercial real estate sector had already ” strongly increased to reach 222 billion euros At the end of 2019, according to the Banque de France. A dynamic that even continued in the first half of 2020 to reach 228 billion euros (+ 8.8% over twelve months).

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