Several of the world’s biggest banks are in the process of relocating a
number of staff who deal directly with clients and some back-office
functions as Britain prepares to leave the European Union next March.
The banks, which include JP Morgan (JPM.N), Goldman Sachs (GS.N), Citi (C.N), Morgan Stanley (MS.N) and Bank of America (BAC.N), plan to “fragment” their operations by expanding or launching services in more than just one city.
While beefing up operations in traditional financial centres such as Frankfurt, Luxembourg and Paris, they are also seeking to expand in citiePlaying down the links with Brexit, the banks say the moves will bring them closer to clients and cut the costs of concentrating their operations in expensive London.
But the rush to set up offices in continental Europe has been mainly triggered by the fear of losing the benefits of EU “passports”, which remove internal borders and allow banks operating in London to serve clients across the bloc.
“It is an enforced change in strategy. If Brexit wasn’t happening, would we be doing all this? No, of course we wouldn’t. And neither would anyone else,” said an insider at a large U.S. bank.
“Does it get you closer to clients? Yes, of course it does. But people are trying to make a virtue out of a necessity,” said the insider, who declined to be named because of the sensitivity of the subject.
Read more: Banks' post-Brexit 'fragmentation' plans hold risks and costs | Reuters
