Bank bosses preparing plans to move abroad as May signals hard Brexit
FINANCE EXECUTIVES say they are preparing for the worst on Brexit as Prime Minister Theresa May signaled she plans to pull the U.K. out of the European single market.
“If you don’t know where you are going, you have to plan for the worst and execute faster,” HSBC Holdings Plc Chairman Douglas Flint said in a speech at the World Economic Forum in Davos. “This isn’t rocket science.”
Banks, bracing for the loss of their right to sell services freely around the EU from London, are set to start the process of moving operations into the euro zone within weeks of the government triggering Brexit talks, which is scheduled to happen by the end of March. Ms. May will say in a London speech Tuesday that she expects Britain to leave the single market and overhaul its links to the customs union, according to a person familiar with the matter.
The “working assumption” is that banks will lose access, UBS Group AG Chairman Axel Weber said in an interview with Bloomberg in Davos. “It’s important to create optionality now, but let’s see what the final agreement is.”
Aberdeen Asset Management Chief Executive Officer Martin Gilbert said it was time for banks to decide whether they were going to move to Dublin, Paris or Frankfurt.
“You have to work out where you are going and you have to plan for the worst and hope for the best,” Mr. Gilbert said.
Ireland’s minister in charge of financial services said he expects a wave of U.K.-based firms to decide to relocate to the country by mid-2017.
Financial companies “have been coming by and meeting with me, and other ministers and the central bank and making preliminary inquiries into office space and staff,” Eoghan Murphy, minister of state at the Department of Finance, said in an interview in Hong Kong. “We think the first concrete decisions in terms of communications to the public are going to be Q1 and Q2.”
He declined to name any of the companies that are in talks to relocate with Ireland’s government, though he said they include U.S. and Japanese firms. – Bloomberg