According to results from an EY Financial Services 'Brexit Tracker' poll of banking institutions, £800 billion ($1.024 trillion) has either already left the continent, or has been earmarked for transition from London to elsewhere in Europe ahead of Brexit. Endless political uncertainty and continued stare-downs in the UK's ruling bodies see investment banks preparing for a no-deal Brexit, shifting their assets out of the UK and into European cities, shriveling London's liquidity pools as investors abandon ship.
Key quotes
Around 2,000 new European roles have been hired locally by financial services companies in response to Brexit, with Dublin, Luxembourg, Frankfurt and Paris the most popular locations.
Since the EU Referendum, 20 companies monitored have announced a transfer of assets out of London to Europe. Not all firms have publicly declared the value of the assets being transferred, but the Brexit Tracker has followed public announcements worth around £800 billion.
As of 30 November 2018, 36% (80 out of 222) of the companies monitored in EY’s Financial Services Brexit Tracker had publicly confirmed, or stated their intentions, to move some of their operations and/or staff from the UK to Europe – increasing from 31% (68/222) over the last twelve months. For universal and investment banks, wealth and asset managers and the insurance sector, that number jumps to 48% of firms (68 out of 143).
Omar Ali, UK Financial Services Leader at EY, comments: “In anticipation of the Parliamentary vote in January, the City will be watching closely to see if the proposed Brexit deal will be accepted or whether it’s back to the drawing board for the Government. As things stand, and per regulatory expectations, financial services firms have no choice but to continue preparing on the basis of a “no deal” scenario.
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