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Dominique Strauss-Kahn, Minister of the Economy, Finance and Industry, has launched a new selection of primary dealers in French government securities (spécialistes en valeurs du Trésor, SVTs). The selection will take place in March 1998 and institutions that wish to apply for primary dealer status are invited to contact the Treasury Directorate without delay. Applications must be received by 10 a.m. Paris time on Monday, February 16, 1998.
The selection will be valid for the next three years; it comes at a key moment for the government as an issuer. The institutions selected will accompany the Treasury through the changeover to the euro.
In this context, and in consultation with the French Primary Dealers' Association, the selection specifications have been drawn up with the aim of strengthening the relationship between the government and the primary dealers. Special emphasis has been placed on their ability to advise the government on its issuance policy, based on their thorough knowledge of investors and their needs.
In view of the need for stronger unity amongst the group of primary dealers, the Minister has also decided to do away with the reporting dealer status (correspondant en valeurs du Trésor) once the new selection is made and he does not intend to select any new primary dealers before the next scheduled selection in three years' time.
At the same time, institutions that are not primary dealers, yet show that they transact enough business on the government securities market, and in particular on the secondary market and in the placement of French debt issues, may be granted the status of Intermediaries on this market. The formal terms of the relationship between these intermediaries and the government as an issuer are still under consideration. Their relationship will, under no circumstances, be comparable to the recognition and close association with government issuance enjoyed by the primary dealers, who will retain the sole responsibility for the primary placement of French government securities.
These developments are in line with Dominique Strauss-Kahn's determination to prepare France for the changeover to the euro and to enable the government to obtain the best refinancing terms.