PARIS, Sept 17 France may introduce a new tax on
banks, based on the size of their balance sheets, to bolster
lending to cash-strapped municipalities and local entities,
newsletter Agefi reported on Tuesday.
The French government has been grappling for ways to fill
the financing void left by the collapse of Franco-Belgian bank
Dexia, which once dominated that market.
Dozens of towns and cities across France are fighting Dexia
over an estimated 11 billion euros in risky structured loans
that went sour after the financial crisis, saddling them with
double-digit repayment rates and in some cases pushing mayors to
go on debtors' strikes.
The French government said in June that it would set up a
special fund to help such local authorities, adding at the time
that the fund would be partly funded by the banking sector but
without entering into further detail.
The French banking federation had no immediate comment on
the story about the new tax, which cited unnamed sources.
The tax would amount to 50 million euros ($66.76 million) a
year, making it relatively mild compared with some of the other
levies the banks pay. Those include a French government tax on
bank balance sheets aimed at penalising bank risk - expected to
total 800 million euros this year - and a separate tax to shield
taxpayers from the cost of rescuing failed banks, expected to
total 1 billion in 2020 alone, Agefi said.
The fact that the tax is based on balance sheets rather than
amount of municipal loans outstanding would mean that France's
largest bank, BNP Paribas, would be hit with a
relatively large bill even though it has just a 1.3 percent
share of the municipal lending market, the newsletter said.
BNP Paribas officials had no immediate comment.
($1 = 0.7489 euros)
(Reporting by Christian Plumb, Lionel Laurent and Alexandre
Boksenbaum-Granier; Editing by Sophie Walker)