The French financial system faced significant challenges in the first half of 2023, triggered by regional bank failures in the US and issues at Credit Suisse. While the specter of the COVID-19 pandemic looms, the French financial system still emerged largely unscathed. This is in no small part thanks to the robust foundations of French banks and a regulatory framework, coupled with effective bank oversight. Nonetheless, this latest episode serves as a stark reminder that existing vulnerabilities, which stem from excessive leverage and inadequate risk management, can easily materialize. In the short term, the situation remains marked by sluggish growth and persistently high inflation. To combat the prospect of enduring inflation, the European Central Bank has hiked key rates eight times since July 2022, which underscores the prioritizing of financial system stability. The French financial system has demonstrated resilience amidst tightening financing conditions and a shifting macroeconomic backdrop. Financing volumes and real estate prices have moderated since late 2022, a trend that can help rectify vulnerabilities tied to high non-financial leverage and inflated property prices. Yet, as economic uncertainties persist and funding costs rise, the risk of potential disruptive shocks for the most susceptible participants remains a concern. Given the currently elevated risks to financial stability, maintaining vigilant oversight is paramount to safeguard the resilience of the French financial system. French banks and insurers are fortified by high solvency and liquidity ratios. Market tensions, although easing since early 2022, still carry the potential for disorderly corrections. Non-bank financial intermediaries operating with high leverage and liquidity risk are particularly susceptible to adverse market shocks. Moreover, a more severe-than-anticipated economic deceleration or a chaotic tightening of financing conditions could effortlessly endanger the most indebted non-financial players. These multifaceted risks demand sustained scrutiny and an unwavering commitment to secure the stability of the French financial landscape.