A senior figure in French finance has said that some major banks are in ‘advanced’ talks to shift some of their operations to Paris? But is that really right?
Benoit de Juvigny, Secretary General of Autorité des Marchés Financiers (AMF) – that’s the French Financial regulator – has told the BBC that large international banks have done their due diligence, and are at the advanced stages of moving some of their operations to Paris.
Speaking on BBC2’s Newsnight, Mr de Juvigny suggested that Paris is far from unique and that other cities across Europe were in similar discussions with banks that operate more or less exclusively out of London.
Newsnight claimed that Frankfurt, Dublin, Luxembourg, Amsterdam, Madrid and Bratislava are all trying to capture business from banks, while Valletta, the capital of Malta was also in the running.
But Mr de Juvigny also warned that cities should not get into a battle using lighter regulation as a way to entice banks. He said: “The danger is the race that we could have for more lenient regulation with a more lenient regulator," adding “I don't believe that [lenient regulation] should be the choice of the UK, but nobody knows.”
It boils down to loss of passporting rights. At the moment, banks based in London can sell financial services across the EU. Post Brexit, this may be much harder. This takes us the crux of hard versus soft Brexit debate and the possibility that London may be afforded a different relationship with the EU, an idea that Theresa May seems to be opposed to.
But, will banks really want to relocate to France, especially in view of the possibility of a Le Pen Presidency and possible EU referendum? One could make a similar argument about shifting to Holland. As for Frankfurt, highly paid bankers work and play hard, in the German finance capital they may only be afforded the former of those two options.
Malta sounds appealing, though.