Brexit means Brexit – except when it means Paris or Frankfurt, where countless banking jobs wound up, according to a study.
Roughly ten percent of the U.K. banking system or £900 billion ($1.24 trillion) in assets left the country and set up legal entities in the European Union following the 2016 decision by British voters to leave the bloc, according to a study released on Friday by New Financial. The biggest beneficiary was Dublin, though further out Frankfurt is to benefit.
The consulting firm said more than 440 financial services firms moved their business, money, or employees out – and that the real total including those which slipped under the radar is well over 500. More will join the exodus over time, New Financial wrote.
Germany In Long Run
The Irish capital leads with 135 relocations, well ahead of Paris' 102, then Luxembourg (95), Frankfurt (63) and Amsterdam (48). «We expect Frankfurt will be the 'winner' in terms of assets in the longer-term, and that Paris will ultimately be the biggest beneficiary in terms of jobs,» study authors Eivind Friis Hamre and William Wright wrote.
The surprise June 2016 voting result against the EU left foreign banks – primarily Swiss and U.S. – which had used the City of London to «passport» into the bloc scrambling for other options. UBS reinforced a Frankfurt hub dubbed UBS SE, while Goldman Sachs reportedly shifted up to $60 billion to Germany as well.
European Sector Pockets
Meanwhile, Credit Suisse had headed for Dublin even before the vote and then later shifted some staff to Madrid, eschewing initial plans for Paris. All of the major European cities had vied to win relocations of finance firms – as had Luxembourg.
Nearly five years after the vote, New Financial reported that the financial landscape is far more «multipolar»: nearly 70 firms are moving staff or business to more than one financial center in the EU, and some cities are emerging as pockets for expertise, like Dublin for asset management, Frankfurt for banking, or Amsterdam for exchanges and broking.
