President Nicolas Sarkozy will push French bankers this week to do more to restrict bonuses so he can hold them up as a good example to other countries at meetings of the Group of 20 in September.
Mr Sarkozy's summoning of top bankers to his office today also aims to show voters he will not allow unlimited paychecks for those seen responsible for a financial crisis which led to recession and rising unemployment in France.
The bankers, who are meeting economy minister Christine Lagarde on Monday, are expected to promise to do more but are worried the French position puts them at a competitive disadvantage, driving top talent away to foreign banks.
Mr Sarkozy and Mr Lagarde have been outspoken on the need to curb bonuses at the G20 and G7 and expressed dismay at record payouts at US institutions such as Goldman Sachs Group.
Authorities on both sides of the Atlantic are stepping up moves to prevent the return to the bonus culture that led to excessive risk-taking blamed for the financial crisis.
The issue will be high on the agenda at a meeting of G20 finance ministers in London on September 4th and 5th to prepare the leaders summit in Pittsburgh on September 24th and 25th.
French banks adopted a code of good conduct based on broad G20 guidelines in February in exchange for receiving billions of euros in liquidity support from the government aimed at ending huge guaranteed bonuses.
But the debate in France was rekindled earlier this month when it emerged that BNP Paribas had set aside €1 billion for possible bonuses after reporting a 6.6 per cent rise in second quarter profits.
Bank of France Governor Christian Noyer, who heads the banking regulator, said the BNP provision was in line with the G20 rules which say pay schemes should properly reflect risks that an institution has taken.
But Mr Sarkozy is facing political pressure for France to do more and make sure other countries do the same.
"France is certainly the country which has done the most but ....we must go further," Xavier Bertrand, a top official in Mr Sarkozy's UMP party told France Info radio on Monday.
Britain has threatened legislation if bankers do not change their ways.
France banned stock options in pay packages for companies receiving state support until the end of 2010 but has not yet threatened to regulate bonuses.
Mr Sarkozy wants to make Paris a more attractive financial centre to draw market participants away from the City of London but bankers say the push on bonuses could drive people away.
Mr Sarkozy's meeting also aims to ensure the banks are passing on the money they were offered in state support by lending to small and medium sized companies.
He created two vehicles with a potential budget of €360 billion to help improve liquidity in the banking sector during the financial crisis.