The gilded panels, chandeliers and frescoed high ceilings of JP Morgan’s offices in Paris seem more Marie Antoinette than modern finance. Its balconies have priceless views across the Place Vendôme, decadent home to the flagship stores of Van Cleef & Arpels, Dior and Chanel.
Yet when hundreds of JP Morgan bankers were told they had to move here from London after Brexit, the news did not go down well. Paris was seen as a financial backwater, lacking London’s vibrancy, good schools and international flavour.
In a quiet office in this palace of a building sits Matthieu Wiltz, who started his career with the bank in Paris in 2000 but spent most of his 23-year career in London, rising to his position as JP Morgan’s head of markets for Europe. He recalled: “Of the 300 to 400 people that moved, 95 per cent of the people — the French included — didn’t want to.”
But there was little choice. Under the terms of Britain’s departure from the European Union, major banks could no longer conduct many types of business with European customers from Britain. So JP Morgan bulked up its workforce in Paris from 280 bankers, serving rich clientele and advising on deals, to 900.
All the big banks beefed up their operations after Brexit. They took slightly different approaches but mainly they have moved trading operations to France.
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London’s loss has been Paris’s gain, as President Macron, a former Rothschild banker, has bent over backwards to encourage firms to move their well-paid executives to his capital. At times dubbed France’s sixth-biggest city, London has its own French schools and according to the Office for National Statistics 155,322 French-born people live in Britain.
Goldman Sachs has a new base with views of the Arc de Triomphe. It now has 400 staff compared with 100 before Brexit, and there is room for 100 more.
Citi has just opened a new trading floor — its second this year — and by the end of the year will have expanded from 170 people before Brexit to 400, boosted by an additional 100 people in the markets team.
Bank of America has kitted out the old landmark post office headquarters in the eighth arrondissement to expand its presence from 70 to 650.
There is something of a momentum effect, now the Paris office staff number in the hundreds rather the dozens. Wiltz, whose teams of traders are largely housed in an ultra-modern trading floor behind the grand old Place Vendôme building, said the large numbers moving helped to persuade his colleagues to follow him across the Channel and were a big draw when hiring locally, too.
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The regional development agency Choose Paris Region said 5,500 financial services jobs had been created or relocated in Paris since Brexit, not just because of moves out of London but due to hiring. The French capital appears to have attracted more people than its rivals in the EU vying for City jobs, although they too have attracted more.
Lionel Grotto, chief executive of Choose France Region, said: “In the end, Paris won the battle of Brexit as a financial centre. When it comes to living in a place, people want to live in Paris.”
Frankfurt is being used for regulatory teams, Dublin for fund management and Amsterdam for share trading.
At the time of the Brexit vote, Paris had not been regarded as one of the front-runners. Macron’s decision to court the industry, timed while the British government was keener on levelling up than delivering a “Brexit for bankers,” was key.
Britain’s financial sector endured the equivalent of a “no-deal Brexit” and continues to work on achieving a “Brexit dividend”, such as last week’s move to axe Brussels’ bonus cap.
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London is gripped by worries about its ability to keep attracting stock market flotations. Euronext, the Paris-based pan-European exchange, is keen to point out new big-name listings and there is angst that the flow of jobs and business to the EU will continue.
Still, Paris had talked about aiming for 10,000 extra jobs after Brexit and the workforces being built here are, for now at least, dwarfed by the ones in Britain. Take JP Morgan: despite its hires in Paris and its pre-referendum warning of thousands of jobs potentially leaving, its workforce across Britain has risen by 3,000 since Brexit to 19,000, partly due to the launch of the consumer bank Chase.
Data from the Corporation of London showed a dip in the number of financial services jobs last year, although that was off a record high in 2020. Paris now faces a test of how it matures as a financial hub and London will be watching.
Macron laid the groundwork. His “Choose France” initiative, launched at the Palace of Versailles, rolled out the red carpet not just to big bank bosses but to international businesses. He brought in reforms to France’s intransigent labour laws, cutting potentially unlimited redundancy payments to three months’ pay for every two years. Even before he took office, France had brought in an “impatriate” tax regime allowing people recruited to work in France to pay lower tax.
Céline Méchain, co-head of Goldman Sachs in Paris, said: “What President Macron did with Choose France is exceptional and made it easier for people to move to Paris. It’s made a more business-orientated city and the perception of France as an investable country.”
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Her co-head, Thierry Sancier, gestured out of a window of Goldman’s grand new offices to point to its small former base across the street — he dubbed it the “submarine” — to make his point. “The ‘before and after Brexit’? If we had this conversation 15 months ago you would have seen us in the second floor of the building over there.”
As Paris establishes itself as a more international financial hub, there are signs of strains in its capacity and frustrations from its new inhabitants. Those who often take the Eurostar back to London complain about the stamps from Customs officials at the Eurostar slowing down travel. Local banks complain they are being raided for staff by the international firms.
Those who have moved to Paris, on the whole, seem happy. Zoeb Sachee, one of the first London-based Citi employees to make the move in January 2022, said: “Before Brexit, we didn’t have opportunities for traders to work out of Paris.”
Sachee, the head of euro linear rates trading at Citi, spent almost all of his 33 years at the bank in London, apart from a short stint in New York. When the chance came, he volunteered to move. He runs a team of 30, five of whom came with him, and expected more traders in London to relocate. “It’s the same job in a different city,” he said.
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He is far from alone in relishing the chance to live somewhere new. Across the trading floor, Saverio Michienzi-Rowedder, 22, had just started out on his career. A German-Italian with Swiss nationality, he said: “Pre-Brexit, we graduates wouldn’t have a choice [to join anywhere but London]. If you ask me if I’d move to London nowadays, I would be inclined to say no. Paris is a ... growing financial centre; you can feel the dynamism here.”
The universities around Paris are being used as a hiring ground in a way they were not before and the expanded banks are keen to demonstrate they are no longer just domestic entities.
At Bank of America, Vanessa Holtz, who had spent 25 years working in London before returning to her home town in 2019, said she had 30 nationalities working with her. “This is not at all a French office,” she said. Visitors hear English everywhere in the office, although people still use their local languages when chatting one-to-one with a compatriot.
The new arrivals have led to a scramble for places in international schools. According to Choose Paris Region, the number of places across the city has risen by 50 per cent to 23,000 since 2015.
Union School, an English-French bilingual nursery and primary school near the Bois de Boulogne, opened in 2022 and is already oversubscribed for 2024. Fresh from a meeting with prospective parents who have just arrived in Paris for work in the financial sector, Ian Tysoe, the head teacher, said: “We’ve seen a lot of interest this term. We have more demand for places in the ‘maternelles’ (2 to 4-year-olds) than we can provide.”
For all the excitement about Paris pinching London’s bankers, at JP Morgan Wiltz cautioned against seeing the cities being in competition with each other. He said the bigger risk was that New York and financial centres in Asia would grab business from both. “We need to stay strong, the UK and Europe together. Otherwise a decent part of the business will leave the region as a whole. To me, that’s a lose-lose for Europe and by ‘Europe’ that includes the UK.”
