Primary dealers are AFT’s close counterparties for all of its market operations. They advise and assist AFT with its issuance policy and debt management, and more generally, with any matter concerning the smooth operation of markets.
A committee made up of leading figures, including Members of Parliament, selects the primary dealers named to serve for three years by the Minister for the Economy and Finance, acting on a proposal from the Director General of the Treasury. The members of the primary dealers’ group have changed over time. There were 13 members in January 1987 and, since then, the group has expanded considerably to represent the diversity of institutions active on the market for French government debt, including major retail banks, specialised institutions, and French and foreign institutions.
On 1 July 2018, the primary dealer group was comprised of 15 institutions (four French, five European, five North American and one Japanese institutions)
- Bank of America - Merrill Lynch,
- BNP Paribas,
- Crédit Agricole - CIB,
- Deutsche Bank,
- Goldman Sachs,
- JP Morgan,
- Morgan Stanley,
- NatWest Markets,
- Société Générale.
The reselection process that started in October in 2015 resulted in the renewal of the primary dealers for a three-year term on 16 December 2015. All these banks had applied for a new three-year term, proving that the primary dealer “label” remains an attractive attribute.
It is the primary dealers’ responsibility to participate in auctions, place Treasury securities and ensure the liquidity of the secondary market.
AFT deals with them as necessary for them to perform their duties:
- overseeing the proper functioning of primary issues;
- ensuring the liquidity of the secondary market in French Treasury securities and upholding their status as one of the euro area’s most liquid securities;
- promoting the market for Treasury securities;
- providing constant and highly pertinent advice to AFT on issuance policy, debt management, promoting the State’s creditworthiness, hedging the State’s financial risks and the workings of the fixed-income markets.
These duties are set out in a charter established in 2003 that governs the relations between AFT and the primary dealers, who have signed the charter and pledged to comply with it. They also undertake to act ethically and comply with best marketplace practices when carrying out their transactions.