- HSBC banks:
HSBC and Goldman Sachs – two major global banks that had publicly threatened to move some operations out of the UK in the event of a Brexit vote – have this morning declined to reiterate such plans.
The omission could be seized upon by the Leave camp as a sign that the firms – and other corporations – were bluffing about jobs losses in order to support the Remain vote in the run-up to the poll. Stuart Gulliver, HSBC’s chief executive, told Sky News in February that Brexit could see 20 per cent of its 5,000 London investment bankers moved out of London to Paris.
Goldman Sachs also issued several warnings that it would be likely to move some staff out of the City if the UK voted to quit the 28-member bloc. But this morning Douglas Flint, HSBC’s chair, emphasised the bank’s “commitment to British businesses, customers and staff,” adding that it “remains undiminished” despite the vote.
Asked about the February comments from Mr Gulliver, a source at HSBC said there was no clarity on the UK’s future trade relations with Europe. “We don’t know what’s happening,” the source said.
HSBC has warned that it could shift 1,000 investment banking jobs from London to Paris if the UK leaves the EU.
As the bank announced it was keeping its headquarters in London after a 10-month review, Douglas Flint, the chairman, told the BBC that while the “best answer” was to remain in a reformed Europe, the bank had the abilityto “move people between London and Paris”.
Flint chaired a board meeting on Sunday night at which the decision was taken not to relocate to Hong Kong – where the bank was based until 1992 when it moved to London to take over Midland Bank.
He said the decision was “based on what will hopefully be a generational view” as he also revealed for the first time how HSBC might respond to a vote to leave in the referendum that could be held in June. The jobs that could move are outside the high street operations and largely in investment banking.
Stuart Gulliver, HSBC chief executive, later told Sky News: “We have 5,000 people in global banking and markets [HSBC’s investment bank] in London and I could imagine that around 20% of those would move to Paris.”
Flint denied suggestions HSBC had lobbied the government to soften the regulatory regime so that it would remain headquartered in London. The bank, which employs 260,000 around the world, 45,000 of them in the UK, is one of the five biggest companies listed on the London stock exchange and the biggest bank in the country.
As well as changes to the tax regime, rules intended to hold individual bankers to account have been eased since HSBC announced the review of its headquarters last April. In his summer budget, George Osborne scaled back the bank levy which, calculated on the size of balance sheets, hit HSBC hardest. Analysts have calculated HSBC will pay £300m to the exchequer – down from £1bn under the previous system.
2. Prudential Insurance:
(ADW) UK Insurance Broker Prudential stated on Wednesday that the group may move some of its funds business from London to Luxembourg following the UK’s Brexit vote to leave the European Union.
A move would mean that the insurer’s investment management arm M&G could contribute in distributing its funds throughout the EU.
M&G’s chief executive Anne Richard told reporters on Wednesday that the company could increase the number of its funds domiciled in Luxembourg and also Dublin, depending on the outcome of Brexit negotiations.
“What we are trying to do is give ourselves options so we are in a position to react and adapt,” Richard told Reuters new agency.
“Dublin and Luxembourg would potentially be options for us if we decide we want to have additional funds domiciled in Europe.”
In the first half of 2016, Prudential performed better than forecast, reporting a 2.4 billion euro profit, due mostly to growth in Asia triggering rising share results.