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      Customer service on an international scale

      Customer service on an international scale

      Crédit Agricole Luxembourg has been present in the Grand Duchy for 90 years. Employing some 1400 employees, the group has a significant presence in the financial centre. Following the retirement of Charles Hamer, responsibility for the private banking business recently passed to Jean-François Abadie. The new managing director, who is responsible for a division of 350 staff, spoke to LFF about the group’s strategy and the challenges faced by Luxembourg in the private banking sphere.

      Did you have any say in becomingadministrateur délégué of Crédit Agricole Luxembourg or was this a group decision?

      I had my say in the matter! I have been a board member of Crédit Agricole Luxembourg since 2004 and am delighted to be in Luxembourg. To return to the field, to be in charge of a business entity and run teams, is a good way of reconnecting with the roots of the business. Furthermore, in addition to my role at Crédit Agricole Luxembourg, which is principally a private banking business, I have the role of coordinator for the Group in Luxembourg since I am also Senior Country Officer.

      What role will Luxembourg play in the group?

      The group has been looking to confirm its presence as a leading banque de proximité in Europe. To be “leader” is an ambition and we are not there yet, but we have the potential to achieve it. The term banque de proximité has two dimensions: closeness to a particular layer of clients, that is the construction of stable, long term relationships and geographical proximity, which is an important element to an enduring client relationship. 

      Private banking is one of the selected business lines that the group intends to develop and its importance has been reaffirmed by the group. This was not the case ten years ago. If you look at group publications from that period, private banking was only mentioned in passing.

      When speaking about Europe, it is hard to avoid Luxembourg. Luxembourg is at the heart of Europe both in the geographical and historical sense. In the private banking sphere our mission is to develop a European clientèle using Luxembourg’s natural advantage which is the capacity to offer those international services of which wealthy European families are in ever greater need. The clients who interest us are people with multinational interests that the domestic banks are not always equipped to handle.

      What is the vocation of Crédit Agricole Luxembourg?

      Its vocation will be to handle wealthy European clients in a European environment. The free movement of services and the European passport are advantages not to be wasted; also the presence of international personnel in Luxembourg, since our staff can speak to clients in their own language.

      Luxembourg is an excellent entry point for wealthy families wishing to invest in Europe precisely because we have competence that covers the whole geographical area. Luxembourg has the capacity to understand the needs of families that have extensive professional assets, who wish to structure their European activities and invest here in a way that is compatible with their tax needs.  I think this is an important card to play in the future.

      How do your clients react to the discussion surrounding banking secrecy ?

      The establishment of clear, common rules that are accepted throughout Europe is something that we feel particularly comfortable with. In fact this has long been a preoccupation of ours. Banking secrecy, or to give it its correct name confidentiality, not meaning vis à vis the client’s home tax authorities but discretion in a much broader sense, is something of real value.

      In some places we have clients for whom discretion is a prerequisite for their security and other clients attach great importance to it because they value their peace.  I believe that this is perfectly compatible with the establishment of rules and tax practices that are accepted by everyone.

      French banks play an important role in Luxembourg, and yet the Luxembourg financial centre is regularly accused in the French press of being a tax haven.  How do you react to this?

      Beyond a few exceptional cases, I do not have the impression that Luxembourg is so very criticised.  To be honest, I believe there is a strong relationship between the two countries and I frankly don’t remember having seen Luxembourg accused of being a tax haven. By contrast, there is widespread ignorance about Luxembourg and the financial centre must talk about the real and objective advantages it has to offer.

      Personally I feel completely comfortable and this was a factor in my decision to come to Luxembourg. I think that mutual understanding is improving and that we are moving towards a calmer situation where the advantages of Luxembourg in a competitive market place are recognised. We have real know-how in servicing an international client base. I don’t think that there is any point competing with banques de proximité in their own territory.

      Evidently, France has been relatively forthright on the question of tax transparency but I don’t think that Luxembourg is considered as a pariah state. It is a European entity in the heart of Europe. Certain points remain to be clarified, but that is the governments’ business, not ours.

      How do you see the future of private banking in Luxembourg?

      There will be some consolidation, since there are companies that are not in a position to make the necessary investments imposed by a European strategy.  Look around you: we all know more and more people whose children live in a different country from the country of residence of their parents. 

      These people have financial interests in several countries and cannot always find solutions for their needs.  Furthermore, in the future there will be very large investors from the emerging markets who wish to invest in Europe.  For these reasons I am confident about the future of the financial centre.

      The point that concerns me is rising costs. This is a subject that must be taken seriously. Salaries and social contributions will rise over time, but we have to keep a very careful watch on this. CW