Business Day

Banks keep to exodus plans

- Gavin Finch London

Big investment banks with their European headquarte­rs in London are forging ahead with plans to create new trading hubs elsewhere in the region in preparatio­n for Brexit.

Big investment banks with their European headquarte­rs in London are forging ahead with plans to create new trading hubs elsewhere in the region in preparatio­n for Brexit despite the UK’s pledge to secure a two-year transition period after March 2019, according to people with knowledge of the situation. The global firms, which employ thousands of people in Britain and largely get by with only satellite offices on the continent, cannot be sure that Prime Minister Theresa May’s call for an implementa­tion phase will result in a binding agreement with the EU, said the people.

Waiting for a deal could be costly because it will take at least 18 months to set up a fully licensed subsidiary inside the EU, they said.

With negotiatio­ns between the two sides deadlocked over what a future trading arrangemen­t might look like, a handful of banks have already applied to EU regulators for permits, signed leases on new offices and will soon start relocating employees out of London. Bank of America is the latest bank to firm up its Brexit arrangemen­ts. The US firm is in talks to secure office space in Paris and plans to initially move about 300 traders there.

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