Banking bonuses are back in France

Forget the financial crisis of last autumn and the promises made by bankers that lessons had been learnt and things would be different in the future.

The French bank BNP Paribas, one of this country's biggest, has announced second-quarter net profits of over €1.6 billion or 6.6 per cent and along with it of course come bonuses for its traders for a job well done.

And not just a couple of centimes scattered here and there, but a full €1 billion more than in 2008 according to the national daily, Libération.

It's a figure, although not denied by the bank, that isn't far off the mark as it admits in a written statement released in response to the article.

"Libération's calculations are close to the amount," it read. "But in any case at the moment they're only virtual bonuses because they won't actually be paid out until the end of the year depending on the results."

Oh well, that's all right then. They're just "virtual bonuses" and traders won't be taking home wallets stuffed to overflowing - well not quite yet.

But wait. There's more. As well as confirming the news, the bank actually justifies it too,

And it comes from none other than the BNP Paribas CEO himself, Baudouin Prot.

In an interview with the daily financial newspaper, La Tribune, Prot clearly doesn't see a problem admitting that the bank has plans to pay out bigger-than-expected bonuses.

"As far as paying bonuses to traders is concerned we have been one of the first banks in the world to respect scrupulously the recommendation of the G20," he said.

"For example, we intend to spread bonuses over several years and make them dependent on results and not revenue," he added

"Those are the principles we're going to apply for 2009."

Reassuring words indeed from a man who also insists that the "crisis has changed us".

Ah yes, as it proudly promotes itself on its official website, BNP Paribas really is La banque d'un monde qui change" or "The bank for a changing world".

Provence-Alpes-Côte d'Azur - it's all in a name

France could soon be bidding farewell to the region of Provence-Alpes-Côte d'Azur (PACA for short).

Only the name though, rather than the actual geographical area.

The region, located in the south of the country (as the name suggests) is one of 26 in mainland France, with another four overseas.

Plans are afoot to change its name from the apparently poetic but cumbersome current mouthful to something a little more snappy and up-to-date.

Well that's if the president of the region, Michel Vauzelle, gets his way.

Vauzelle says the naming of the region, and in particular the use of the epithet "PACA" since the time of Charles de Gaulle, has been the butt of many a joke, to the detriment of the local population.

As far as he's concerned it's far from being funny and time for a change to something that better reflects the area and its population.

"Provence-Alpes-Côte d'Azur is a beautiful name," he says. "But it's too long and not very practical."

In his search for an alternative, Vauzelle commissioned an Internet poll during the second half of July in which 10,000 local people were asked their views on what would be a preferable replacement, and the initial results are in.

"Provence" (well that certainly is short) and "Provence-Méditerranée"" apparently topped the list, with "Alpes Méditerranée", "Provence Azur" and "Sud" (even shorter) also remaining in the running.

The next step will be to set up a committee of experts or so-called "wise men" (and women presumably) who will examine the results before drawing up a short list to be put to the local population (at large) some time in the autumn.

For those of you still scrambling to locate Provence-Alpes-Côte d'Azur or PACA on a map, it incorporates six departments in the south of France: Alpes-de-Haute-Provence, Alpes-Maritimes, Bouches-du-Rhône, Hautes-Alpes, Var, and Vaucluse.

And of course it also includes some of the major cities in the south, among them Marseille, Nice and Toulon

It boasts a population of over 4.8 million, which, if you do the maths, means that less than 0.2 per cent have so far expressed an opinion on the name change.

But that evidently is enough for Vauzelle and the rest of the regional council to press ahead with the campaign.

A banking giant is born

Monday sees the creation of what will be France's second biggest retail bank with the official merger of Banque Populaire and the Groupe Caisse d'Epargne to become BPCE.

Far from being a marriage "made in heaven" though, it is one born out of necessity and despite its size, the process of finally "becoming one" has not been without its difficulties.

Although the green light will be given for the new bank to operate throughout most of the country, there's a slight problem in Ile de France, the area surrounding and including the French capital.

The Paris court of appeal has blocked the merger for the moment because of what it insists a "failure to inform its personnel sufficiently on the merger plan between the two banking groups."

A decision as to when the Ile de France branches can be merged into the new BPCE will have to wait until the court's final ruling later this month.

In the meantime though the creation of BPCE is official throughout the rest of the country in a move which creates the second-biggest retail bank in France behind Credit Agricole.

When the credit crunch hit the world last year, Banque Populaire and Caisse d'Epargne seemed the best match in terms of the desire by French authorities to limit the effects here of the financial turmoil and consolidate the country's banking sector.

Both were major shareholders in the investment bank Natixis which was hard hit by the sub-prime mortgage crisis in the United States. Between them, the two held 70 per cent of Natixis' shares.

But the merger process has been far from an easy one.

In October last year, just as talks were underway between the two groups, Caisse d'Epargne had to come clean and reveal that it had lost around €600 million in unauthorised derivatives trading.

The chief executive at the time, Charles Milhaud, resigned taking full responsibility, but it was a loss which brought a sharp rebuke from the French president, Nicolas Sarkozy, who described it as "unacceptable" and an investigation was launched into how it had happened.

And at the end of February there was further controversy when François Pérol was nominated to become head of the two banks once merged.

He was a former top financial advisor to Sarkozy, and critics contested that his appointment represented a conflict of interests.

When fully operational the new group will reportedly have around 34 million customers at over 8,000 branches and employ around 110,000 people.