Nick Shaxson ■ Report: a third of French banks’ foreign subsidiaries are in tax havens
From the French platform on tax havens Plateforme Paradis Fiscaux et Judiciaires, coordinated by CCFD-Terre Solidaire and Secours Catholique Caritas France, a new report looking at the first figures published by French banks this year, under requirements for country by country reporting. Congratulations to our French colleagues for gaining widespread media coverage in France, and for their role in pushing the French government to act on transparency more actively than in other countries.
France is generally ahead of the pack on requiring country by country reporting from banks, though so far it’s only partial: we get the activities of subsidiairies and turnover and employees on a country by country basis; next year they will publish profits and taxes. The report is only in French so far (an English translation is due next month, we’re told) but here are the key findings:
- A third of the foreign subsidiairies of the five largest French banks are located in tax havens
- 26 percent of French banks’ international turnover are located in tax havens
- Subsidiaries in tax havens are mainly specialized in investment solutions, structured finance and asset management. Their retail activities are a lot less important than in other countries (half as much for BNP Paribas, a third as much for Crédit Agricole)
- Employees of banks located in tax havens are two times more profitable than employees located in other countries (more than 3 times for Societe Generale and 13 times for the BPCE Irish employee).
- Luxembourg is the favourite tax haven of French banks : 117 of their subsidiairies are located in Luxemburg (then come Belgium, Hong Kong and Switzerland)
- The Cayman Islands are the black hole of banking business, with a very disparate turnover (sometimes negative), fifteen subsidiaries for the major French banks and no employees.
- Tax havens are more attractive than emerging countries: the turnover of French banks in emerging countries is 5 times less important in the BRICS than in tax havens.
The full report is here.