Crédit Agricole

As of January 2009, Crédit Agricole (CA) and Société Générale (SG) agreed to merge their asset management (AM) operations, known as CAAM and SGAM. Marie-Pascale Bonhomme, a managing director at Crédit Agricole, visited us in Switzerland and provided an interactive presentation. Both of these notable banks are located in France, and Crédit Agricole is the largest retail bank in Europe with 58 million customers in 74 countries.

As part of her discussion with us, we divided into several groups and brainstormed about the issues surrounding the merger effort. My team focused on the legal aspects, and the main issues we identified were anti-trust laws and workforce reduction. Just like in the United States, laws are in place to prevent monopolies from being created, and Crédit Agricole being such a large institution, it would likely be required to defend itself in that vein. Although I knew beforehand that laying someone off in France is more difficult than in the United States, it didn’t dawn on me until this discussion that it could be such an issue. Unions have a strong influence in France, and companies must provide explanation that there is no other suitable job and report why the person is being let go. Furthermore, regulations exist that require companies to offer large severance packages.

Marie’s presentation gave me a different look into businesses operations in Europe, particularly in France, and the implications of the merger coincide well with what I have learned about French culture. Most pointedly, the people place a high value on job and economic security, and the national policies strongly reflect it.