Presidential election: French banks under pressure

In the run-up to the second round of the presidential election, tension is mounting in the French banking sector, which is worried about a possible victory for Marine Le Pen. Banks are staying out of the political arena, but fear financial upheaval should the Rassemblement National candidate win.

Surveys closely monitored by banks

With only 48 hours to go before the second round of the presidential election, French banks are taking care not to position themselves, but they are nonetheless keeping a close eye on the polls.

As a source from a national banking network told Les Echos, "We have a crisis unit, and we monitor both the surveys and market expectations on a daily basis".

A possible victory for the Rassemblement National (RN) candidate could have an economic impact taken very seriously by the banking sector, which is mindful of Marine Le Pen's past stances on a number of issues.

In the 2012 presidential election, for example, she wanted to "clean up banking practices" by "partially nationalizing" deposit banks, as Les Echos recalls, and 5 years later, in the 2017 presidential election, she proposed taking France out of the euro.

While her rhetoric is no longer the same today, as she runs for president for the 3rd time, some of the measures she proposes still run counter to the European treaties.

The "national border control" of goods, and the reform of the Schengen agreements she advocates to strengthen immigration control, could expose France to infringement proceedings launched by the European Union, as was the case for Poland.


A significant economic impact

The economic consequences of such a challenge to European integration could be considerable, according to the French banking sector.

"We could experience a liquidity crisis of three months, going up to a year in the most severe models," says another banking source interviewed by Les Echos.

According to the same source, the worst could still be avoided thanks to the experience gained by the banking sector, which weathered the 2008 financial crisis and watched several populist leaders come to power in various European countries. However, French banks fear "a downturn" in the country's financial situation if the RN candidate wins.

Banks are therefore keeping a close eye on the results of the second round, but are careful not to take a public stance, anxious not to arouse the discontent of customers of different political persuasions.

Only the president of Crédit Mutuel Alliance Fédérale, Nicolas Théry, has announced his intention to vote for Emmanuel Macron. As for the banking sections of the unions, those of the CGT and CFDT have called to counter Marine Le Pen.