The Liikanen report on European banking doesn’t call into question BNP Paribas SA’s universal banking model and won’t hurt its ability to service corporate clients, said Francois Villeroy de Galhau, chief operating officer of France’s largest bank.
“The report validates the value of universal banking, and recognizes that corporates require a wide variety of activities from risk management to financing,” Villeroy said at a press meeting in Paris today.
Last week, a European Union-commissioned group, led by Bank of Finland Governor Erkki Liikanen, presented a report that recommends a “legal separation of certain particularly risky financial activities from deposit-taking banks within the banking group.”
Villeroy said the activities that Liikanen suggested be walled off “have nothing to do with financing corporate clients.”
French President Francois Hollande, elected in May, has pledged to overhaul the country’s banking industry to better separate consumer banking from the riskier investment-banking operations.
The EU report found that Paris-based BNP Paribas and Societe Generale SA, together with Barclays Plc of London, Frankfurt-based Deutsche Bank AG and Royal Bank of Scotland Group Plc of Edinburgh had the highest proportion of trading assets, accounting for more than 30 percent of total assets. The value of trading assets fluctuates with their market performance.