French finance minister woos US banks after Brexit vote

French finance minister Michel Sapin made a pitch to senior executives of four of America's largest banks to relocate to Paris after the UK leaves the EU, but raised eyebrows by talking in French with the assistance of an interpreter.

Senior bankers at Goldman Sachs, JPMorgan and Bank of America, as well as Swiss bank UBS, lunched with Mr Sapin at the Hotel Sofitel in Washington DC during an official trip for the G20 meetings in October, according to people at the event.

The chief executive of Citigroup met Mr Sapin separately that same morning, according to people with knowledge of the meeting.

Over the 1½-hour- long lunch, Mr Sapin set out the stall for Paris as a potentially leading European financial centre following Brexit. He cited the city's office space, large companies, tax benefits for expatriates as well as increasingly flexible labour laws.

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One person close to the situation in Paris said that the reaction was “positive” from the bankers, although the meeting was not intended to solicit firm commitments on moving jobs to Paris.

Others were less convinced about the outcome of the meeting. “The fact that the French minister of finance needed to discuss this via an interpreter was seen . . . as a negative,” said one person.

High corporate tax

He added that a discussion about France’s relatively high corporate tax rates reassured attendees that it was high on the agenda, but there were still questions about how far the country would move on the issue.

Bankers also sought assurances on schooling, terrorism and personal income tax rates.

In attendance was Bob Elfring, chief executive of Bank of America Merrill Lynch International; Walter Gubert, a former vice-chairman of JPMorgan; Kevin Arnold, global head of senior relationship managers at UBS; and John FW Rogers, chief of staff at Goldman Sachs.

The banks declined to comment on the meeting.

The Sofitel lunch was one of dozens of formal and informal meetings between French officials and international banks on the attractions of Paris as a financial centre. French officials have also met Asian and British banks.

Paris has had some early victories in the battle to win business from London. HSBC last week became the first big bank to detail plans to move jobs out of London after the Brexit vote, confirming plans to move 1,000 roles in its London-based investment bank to Paris.

Many bankers at non-European banks say the inflexibility of the French labour code, along with high taxes, are reasons their groups will be reluctant to move to Paris.

– Copyright The Financial Times Limited 2017