The joke going around Parisian financial circles is that CGT, the Confédération Générale du Travail, the French trade union umbrella organization, has a new meaning: Confédération Générale des Traders. Meanwhile, at the investment banking office at Natixis, real CGT flags are draped in the windows.
Especially for someone used to London, investment banks are the last place you might expect to see union activity. But the strength of trade unions in continental Europe is a big worry for bank chief executives and their investors. Many more cuts are needed to make these banks profitable, especially in investment banking, and above all in France and Germany.
More worrying still, the increasingly charged atmosphere in European politics could make it harder to carry out the employee negotiations that by law must happen before bank restructuring plans can go ahead. Populism in the style of the Gilets jaunes (yellow vests) could impact the willingness of their representatives to play ball, or obstruct their executives’ attempts to do so.
Trade unions may already be part of the reason why European banks – in France, and especially Germany – are less profitable than their US peers.