HSBC ready to move 1,000 bankers to Paris on ‘Brexit’: CEO says
HSBC Holdings Plc Chief Executive Officer Stuart Gulliver said the bank would probably move about 1,000 investment bankers to Paris if Britain decided to leave the European Union, in one of the most detailed contingency plans revealed ahead of a referendum.
Some of the 5,000 jobs in HSBC's global banking and markets unit, which houses securities and trading operations, would shift to Paris, Gulliver said in an interview on Monday. While an outcome in favor of Brexit would have a "significant impact" on the investment-banking division, it wouldn't affect the consumer business, he said.
Banks executives have warned that a vote in favor of Brexit would cause companies to cut investment in the UK and move jobs elsewhere. Prime Minister David Cameron, who faces euro-skeptic sentiment in his party as well as the country, has pledged to hold a vote on the U.K.'s membership of the 28nation bloc by the end of next year, and is currently negotiating a revised deal. "It's in Britain's economic interest to remain in a reformed EU, and that is a formal position," Gulliver said.
Michael Rake, chairman of BT Group Plc and former deputy chairman at Barclays Plc, said last month that Brexit has already caused a loss of investment in Britain and the development could accelerate if it looks like the country will vote to leave. Barclays Chairman John McFarlane said a referendum in favor would leave the City of London's financial district in a "significantly worse" position.
British stocks could fall 15 percent on a vote to leave the EU with a basket of domestically focused companies dropping as much as 26 percent, analysts at Deutsche Bank AG including George Buckley wrote in a note dated Friday.
"It depends on what the terms of an exit were and if they were to negotiate a passport for financial services," Gulliver said. "There would be a period of great uncertainty and disruption while the markets waited to see what the terms of the negotiated exit would be." Gulliver spoke after HSBC opted to keep its headquarters in London, ending 10 months of deliberations over whether to move abroad.
Meanwhile, HSBC Holdings Plc recommitted its future to London, ending 10 months of deliberations over whether to move its headquarters, after securing concessions from the UK government on regulation and taxes.
The shares rose. Europe's largest bank said it will continue its 23-year stay in the U.K. capital after its board, led by Chief Executive Officer Stuart Gulliver and Chairman Douglas Flint, convened there on Sunday. The decision was unanimous, according to a statement from the bank.