Sibos 2020: View from the Top with Jean Lemierre, Chairman of the Board of Directors, BNP Paribas

First, good to be with you. I like your question. Definitely it was a health crisis and it still is, but I wouldn't say it's a financial crisis. For once, this is not a banking or financial crisis. It's a massive pandemic with economic impact, but the financial sector has done well and done its job. That's crucial for the future. We had two main priorities: first, support our clients. At a time of massive disruption with no business or income, we used bank balance sheets to lend to the economy. BNP Paribas offered massive lending in March and April. That helped companies pay suppliers and employees. Second, ensure the payment infrastructure worked. It's remarkable that there was no disruption. People take it for granted, but it's efficient. Swift and the teams did a great job making payments happen smoothly.

I think we are unfortunately in the same situation. The economy is recovering. Are we in a V or K shape? I would say V because the rebound is sharp at the beginning then slower. We'll continue to accompany clients. We may see an increase in bank risks as some clients have difficulties. We have capital to face that. But we also prepare the future. BNP Paribas is committed to supporting new projects. Business leaders are active and want to grow. We need to finance them. Also, for payments, there is the European Payments Initiative (EPI) by 16 to 18 banks to develop a new payment system using new technologies. So supporting existing clients and developing new ones is our commitment. I want to add that we've been helped massively by the official sector: central banks, regulators, governments. This teamwork is the first time I see such collaboration between banking and official sectors. Hopefully we'll address the challenges ahead.

May I mention the initiatives around an industry standard API. That's crucial for systems to operate together. Swift is doing a good job making sure it's inclusive. The API initiative is very important for the future. The public doesn't see this, but behind our sophisticated systems there's a lot of work. This forum will help promote the standard quickly and efficiently.

First, I agree this is a massive challenge, but this crisis is an opportunity to address climate change. In Europe, we are committed. The EU recovery plan of 750 billion euros has environment at its core. Recovery will be green. We shouldn't oppose economic and social recovery and environment. Banks are at the core. We have to be creative, find solutions, offer products and policies to help investors, corporates, individuals. Hopefully the banking industry will take this into account. In Europe it's very high on my agenda and my colleagues' agendas.

I am, I am. I won't enter the debate you want to drag me into, but I am because this is an obvious challenge for everybody. In Europe we may be a step ahead, but when I look at China I'm encouraged, and when I meet American investors they speak about environmental questions. The understanding and willingness to move forward are very high. Now we have one difficult question: how do we measure this? In Europe we have a taxonomy approach, so we know what is green. But how to measure what we do? That's a key challenge. I want to use the word 'transition'. The banking industry's job is not to decide what is green and not green, but to make sure what is not green begins to be greener. Measuring transition is a big challenge. For example, a coal electricity company needs to invest in wind and solar. We need to measure their commitments and monitor success. Same for shipping, improving engines. So financing the transition is what we need to do more. We have to work together with accounting firms, NGOs, rating agencies, corporates, banking, asset management, insurance to have clear, quantified measurement and incentivization to ensure commitments are respected and measured.

Well, in the limited time, may I pick up the Brexit question, which is closer to me. Brexit will happen; it was decided by the British people and is being negotiated. I hope it happens in the best way with some kind of agreement. But whatever happens, I'm sure supervisors and regulators (ECB, Bank of England) will ensure it is implemented smoothly. I'm confident they will smooth the process. At BNP Paribas, we know clients are worried, so we are prepared for various scenarios and committed to supporting them.

It's the risk of democracy. Democracy is the best regime. We need to accept that there are changes in policies. Banks have to adapt. The US is a great democracy; I have no fear. We are a large European bank, we know how to operate in the US. We trust our clients. It's going to be fine. Let's avoid creating risks where there are none.