Global banks are set to pull out of UK early next year because of Brexit
A number of leading financial organisations are said to be planning to relocate overseas due to uncertainty over Brexit negotiations.
As reported in The Observer, Britain’s biggest banks are preparing to relocate out of the UK in the first few months of 2017, while a number of smaller banks are planning to leave by Christmas.
Anthony Browne, who is chief executive of the British Bankers’ Association, has cited fears the European Union politicians will want to erect trade barriers during the Brexit negotiation as a reason for the planned moves. So rather than risk weakening the strength of the City of London's financial prowess during negotiations, a number of companies are preparing to move wholesale.
Writing for the newspaper, Browne claimed, 'Banking is probably more affected by Brexit than any other sector of the economy, both in the degree of impact and the scale of the implications.
'It is the UK’s biggest export industry by far and is more internationally mobile than most. But it also gets its rules and legal rights to serve its customers cross-border from the EU.
'For banks, Brexit does not simply mean additional tariffs being imposed on trade – as is likely to be the case with other sectors. It is about whether banks have the legal right to provide services.'
(Photo by Dan Kitwood/Getty Images)
Browne cited the talks over "Hard Brexit" and a removal from the single market as damaging to the current system of banking that makes the City of London a global leader for finance.
Warning that 'the rhetoric is hardening’ Browne writes: 'The problem comes – as seems increasingly likely, judging by the rhetoric – when national governments try to use the EU exit negotiations to build walls across the Channel to split Europe’s integrated financial market in two, in order to force jobs from London.
'From a European perspective, this would be cutting off its nose to spite its face.'
Finishing his dramatic claims, Brown added, 'Banks might hope for the best but have to plan for the worst.
'Most international banks now have project teams working out which operations they need to move to ensure they can continue serving customers, the date by which this must happen and how best to do it.
'Their hands are quivering over the relocate button. Many smaller banks plan to start relocations before Christmas; bigger banks are expected to start in the first quarter of next year.
'London will survive as a global financial centre. Finance is inventive and will find a way through.
But putting up barriers to the trade in financial services across the Channel will make us all worse off, not just in the UK but in mainland Europe.'
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