An update on Brexit: How it will effect the finance industry

With Brexit talks in full swing, financial services companies based in the United Kingdom are starting to plan for the life after the United Kingdom leaves the European Union in 2019. With a deal far from being agreed upon and the likelihood that a deal may not be agreed within two-year timeframe companies need to start making decisions.
Some companies have already made their decision on what they will do while others are still planning their next steps. In this article, we will look what the plans are for the big financial companies and the impact Brexit could have on the financial industry in the UK.

Bank of America

The American bank became the latest high-profile financial firm to announce their plans of moving some of their jobs within the European Union. More specifically Dublin and Ireland. The bank which employs around 6,500 people in the United Kingdom already have 700 staff in the Ireland, now looks like they are planning to increase that as they are preparing for a ‘hard’ Brexit. However, they have not confirmed how many jobs will be moved to the Irish capital.

Morgan Stanley

Morgan Stanley are looking to move around 200 jobs to the German city of Frankfurt after Britain leaves the EU, which would increase their number employees to 400 in the Germany’s fifth-largest city. The American banking giant will also be applying for a licence with the local German regulator that will allow the company to continue trading within the European Union after the UK leaves the bloc.

Citi

Citigroup employs around 19,000 people in the European Union which includes 9,000 people in the United Kingdom. The US investment bank has chosen Germany’s financial centre Frankfurt as their destination for their new major trading operation.

Deutsche Bank

The German global banking and financial company which employs over 8,000 people in the UK are also preparing for a ‘hard’ Brexit. Looking to move some jobs to Frankfurt. Deutsche Bank CEO John Cryan sent a video message to its 98,000 employees last week saying.

‘There’s an awful lot of detail to be ironed out and agreed, depending on what the rules and regulations turn out to be’ Cryan said in the video. ‘We will try to minimise disruption for our clients and for our own people, but inevitably roles will need to be either moved or at least added in Frankfurt.’

Goldman Sachs

Goldman Sachs employs around 6,500 people in the United Kingdom, has made plans to add hundreds of staff to its offices within the European Union to carry on working within the bloc after Britain leaves the European Union.

In summary

It has been suggested that Brexit could cost the United Kingdom around 30,000 jobs as finance companies look to move their employees and operations into the European Union. It is too early to know how many jobs the UK will actually lose as the negotiations between the UK and the EU are still in progress, we can see that the financial sector is bracing itself for a ‘hard’ Brexit and already making decisions even before a deal is agreed between the two parties.

By: Klavs Valters
GO Markets