Brexit, Banking and the City: the Drift is Getting Driftier

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#1
In the UK, financial services account for almost 12% of the total tax take and employ 1.1 million people, but the government's Brexit plan, the Chequers deal, ignores the sector completely, largely because the EU do trade deals on services, only on goods. So far, the impact on jobs in the City has been limited, but an announcement today seems set to change that, or at least to be the beginning of a change.

The announcement comes from HSBC, who are moving their seven London-based but EU-facing offices to Paris, with about 1,000 jobs affected. This move is planned for early 2019, before the March Brexit deadline and is driven by what the bank describes as “political and regulatory developments in Europe”. These developments, more commonly referred to as the lack of cake, are now going to be the clear focus for other London banks and service providers with significant business in the EU, so I suspect we can expect more of the same from HSBC's rivals in the coming months.

From London to Paris: HSBC set to move seven offices amid Brexit uncertainty

Remember, London voted Remain.
 

Dublin 4

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#2
The Europe-focused offices, which are responsible for the bank’s activities in Italy, Spain, the Netherlands, Belgium, Luxembourg, the Czech Republic and the Republic of Ireland, will see up to 1,000 staff to be affected.
While not mentioning Brexit specifically, a HSBC statement said it was: “adjusting its activities” in light of “political and regulatory developments in Europe”.




:sleep::sleep::sleep::sleep::sleep:
 
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#3
Here's the independent's take on it:

HSBC in €255m plan to move 1,000 jobs to Paris after Brexit - Independent.ie

HSBC could spend up to $300m (€255m) moving jobs and parts of its business to Paris following Britain's exit from the EU, CEO Stuart Gulliver has said.

The estimate, one of the most detailed yet by a major bank, includes the costs of relocating up to 1,000 jobs to the French capital as well as associated legal fees, Gulliver said.
"The $200-$300m total is the cost of the transition to France," Gulliver said after HSBC reported an increase in profits for the first half of the year.
HSBC said up to $1bn in revenue could be at risk from Britain's exit from the EU but it should be able to preserve the income by shifting associated jobs to Paris, Gulliver said.
Companies are spending tens of millions with international banks establishing new subsidiaries in the bloc or developing existing ones. That's despite little clarity on how much business their UK outposts will be able to do in the EU once Britain leaves in March 2019.
 
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#4
And it's not just HSBC:

Banks lay out plans to move jobs from UK as prospect of no-deal Brexit looms

Of 222 large banks, insurers, asset managers and other financial services companies tracked by Ernst and Young (EY), more than a third have said they are considering or have confirmed they are moving operations and/or staff from the UK to the EU.


A quarter – 53 firms – have confirmed at least one relocation destination, with the main beneficiaries being Frankfurt and Dublin.
Great oaks from tiny acorns?
 

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#6
The UK Treasury are taking it seriously, anyway:

10/08/2018 - UK Treasury Looking at Contingency Plans | RationalFX
Yesterday the UK Treasury said it would soon start putting contingency arrangements in place for financial services regulation if the country crashes out of the European Union without a deal. Currently Financial services accounts for roughly 6.5% of the UK’s economic output. The Treasury said that firms should continue to plan for a transition phase of around two years, which will come into force when Britain leaves the EU in March 2019 provided both sides come to an agreement on a deal. It is was also preparing just in case no deal is struck, the plan for a no-deal scenario would see Britain convert EU laws and regulations into British law.
So, total regulatory convergence, it seems.
 
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#9
Seems like these and other moves by the big financial houses are being done to establish offices that will be within the EU regardless of deal or no deal on Brexit. A hedge of sorts. If no deal is struck, then there will be wholesale movement, but if there is a deal in place, then European operations won't be affected.
 

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Tadhg Gaelach

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You're awful big on the City of London for a Stalinist, if you don't mind my saying.
 
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