This week's attempt by France's second biggest bank, Banque Nationale de Paris, to gatecrash the merger between rivals Paribas and Societe Generale, has posed a real dilemma for France's financial and business elite.
Do they allow the French bureaucracy to engineer a cosy stitch-up, in which shareholders of the three banks will ultimately be the losers, or do they tell the French Government where to get off? The French authorities seem to want a solution which is in the interests of La France, keeps the foreigners out, and doesn't involve any job losses. The interests of shareholders are neither here nor there.
France has repeatedly flouted both shareholder rights and wider European law by vetoing foreign buyers for French assets, or by allowing them in only on condition that the French end up running the show.
What seems to have triggered the initial SG Paribas deal is that an approach was made by ABN-Amro, the Dutch bank, to Societe Generale - through the intermediary of the Dutch central bank. ABN-Amro was immediately given the brush off, and the farce of the present French solution thus began.
Barclays and Lloyds have both expressed interest in buying a French bank, but because of Britain's non-participation in the euro they are even more beyond the pale than the Dutch. Even so, it may be worth someone's while to try and bust the whole thing open.
Who better than Sir Brian Pitman, chairman of Lloyds TSB, to show the French what shareholder capitalism really means by tabling an open offer for the lot. Is France ready to join the 21st century, or is there to be a retreat into old fashioned corporatism, where shareholders get hung out to dry for the sake of what politicians think are the wider interests of the great republic? There's only one way to find out.Reuse content