BNP Chief Calls for Greater French Effort to Lure Banks to Parisby
U.K.’s vote to leave EU triggers race for London bank jobs
Bonnafe sees eliminating tax on banker pay as priority
President Francois Hollande’s government will have to go beyond current efforts on tax if it hopes to attract banking business to Paris in the wake of the U.K. decision to leave the European Union, BNP Paribas SA Chief Executive Officer Jean-Laurent Bonnafe said.
Since Britain voted to leave the 28-nation EU June 23, remaining members of the club including France and Ireland have started pitching to win business and jobs from London, the region’s largest financial center. In France, Prime Minister Manuel Valls pledged to improve a special tax regime for foreigners, among other measures. Bonnafe says that won’t be enough.
“Several other significant steps are needed to bring back competitiveness and attractiveness to Paris” as a financial center, Bonnafe, the head of France’s largest bank, told journalists Thursday.
Reducing or eliminating a payroll tax on French bankers’ pay is the “first priority” and efforts should also be made to reduce the corporate tax rate toward a 26-28 percent range seen elsewhere in Europe, from about 33 percent currently, Bonnafe said. France’s wealth tax is also among factors currently playing as “deterrents” to attract jobs to Paris, Bonnafe added.
“This effort is needed, it must be done relatively quickly, probably over the coming year or 18 months,” Bonnafe said.
BNP Paribas said Thursday its corporate and institutional banking revenue rose 1.4 percent on bond trading gains in the second quarter amid turbulence created by the U.K. vote. The bank has said it’s too early to say if Paris will benefit versus London and the bank can adapt to keep serving client needs.