Large international banks are taking significant steps in planning moves to France when Britain leaves the EU, the head of the French financial regulator has said. Benoit de Juvigny, secretary general of the AMF, said the watchdog had received informal inquires from banks seeking information on how they would be regulated if they moved to Paris.
There were indications that large international institutions had been working to ensure they were primed for a move rather than carrying out low-level scoping exercises, he said.
“In some cases, I would say we are still at the level of inquiries or informal enquires by consultants, by lawyers and so on, but in other cases, especially regarding large international banks, it’s a normal informal inquiry, but they have been undertaking due diligence and we are receiving lots of practical questions regarding the way they are going to be managed from our perspective, from their relationship with the French regulators.”
Depending on the outcome of negotiations to leave the EU, companies based in the UK may see their ability to do business on the continent restricted or removed. The prospect has led to speculation that financial institutions that rely on the so-called “passporting” of services may leave if those rights are taken away. It may mean that London in particular sees its large financial sector lose business to European cities such as Paris, Frankfurt or Amsterdam.
Mr de Juvigny said he would welcome the challenge of an influx of foreign firms, but he warned that competition between European financial centres should not trigger a race to deregulate. “It’s a dangerous challenge,” he added. “We could see some kind of new competition between countries, between regulators.” – (PA)
