PARIS, Oct 1 (Reuters) - French banks have steadily lowered their mortgage lending standards as borrowers binged on cheap credit, pinching their margins, France's financial stability watchdog said on Tuesday.
The High Council for Financial Stability, which includes the finance minister and central bank head, said in a report on real estate that it did not see a clear sign the market was at risk of overheating.
However, it warned that banks had "progressively but continuously" lowered their lending standards, which it said needed to be watched closely.
Meanwhile, banks lending margins had become razor thin, which could become dangerous if borrowers renegotiated en masse their mortgages at lower interest rates, the council said.
(Reporting by Leigh Thomas Editing by Geert De Clercq)