Redbridge’s latest annual study on the financing of large groups listed in France reveals a rise in their level of indebtedness coupled with a marked slowdown in their investments.
The liquidity coverage ratio – an indicator of companies’ capacity to meet their debts due within a year – remains solid, although it has been gradually declining since 2018.
In what has become an environment of tighter credit, with banks becoming increasingly selective in who they lend to, Redbridge is urging treasury departments to fully integrate lenders’ return logic into their funding strategies. The adoption of the finalized Basel III regulatory framework is prompting banks to adjust their lending policies.
Study findings
Redbridge’s 15th annual study on the financing of companies in the SBF 120 – an index of the 120 most actively traded and largests companies listed on Euronext Paris – covered the 2024 financial statements and developments in the first half of 2025 for 84 index constituents.
The study found that during this period, the performance of SBF 120 companies (excluding financial and real estate sectors) stabilized, while their net debt increased (+14%) and their capital expenditure (net of disposals) fell sharply (-20%).
- Working capital requirements seem better controlled than in 2023, as shown by the improvement in the cash cycle, mainly due to a decrease in trade receivables.
- Net debt levels have risen due to a drop in cash levels. Leverage has fallen to around 2x.
- Liquidity coverage has been falling since 2018. At the end of 2024 it stood at 2.4x, down from 2.8x one year earlier.
- The decline in interest rates in Europe has not yet translated into lower financing costs for SBF 120 companies, as most of their market-issued debt is at fixed rates.
- Banks remain active lenders but more selective in who they provide liquidity to. Meanwhile, private debt investors are eager to deploy their abundant liquidity but the rates they are offering are still high.
- For companies, understanding lenders’ profitability logic (RAROC / RoRWA) is key in negotiating with their banking syndicate. Showcasing the side business (in other words, non-core revenues or services) that companies can bring to their bank has become indispensable.
According to Didier Philouze, Managing Director, head of debt advisory at Redbridge:
“The financial health of most companies remains solid, but we have witnessed a steady erosion of credit indicators over the past four years, and this is now drawing banks’ attention.”
Matthieu Guillot, Managing Director, debt advisory at Redbridge, commented:
“Broader consultations with new lenders, including international banks or regional affiliates of mutual banking groups, make it possible for companies to preserve access to abundant liquidity – provided their requirements in terms of business plans are well integrated.”
Muriel Nahmias, Managing Director, debt advisory at Redbridge, added:
“Even if banks speak little of it, capital requirement regulations are becoming stricter. Borrowers with implicit ‘investment grade’ profiles – whether unrated or crossover – must factor the impact of the finalized Basel III framework into their financing strategies, as it could be less favorable to them.”
The full study is available upon request.
About Redbridge
Founded in 1999, Redbridge Debt & Treasury Advisory provides the world’s leading companies with data-driven advice for more profitable outcomes. With teams in Paris, Geneva, London, New York, Chicago and Houston, Redbridge has conducted more than 750 assignments ranging from strategy design to operational implementation over the past ten years, helping companies optimize their financing and treasury activities.