UK bank bosses have launched a frantic lobbying effort in an attempt to persuade their foreign counterparts to put on hold plans to shift operations to other major European cities.
According to senior City figures in Davos, international banks are being asked to resist moving jobs, “for the good of London”, until it becomes clearer that the UK can hammer out a transitional deal with Brussels.
The campaign is a concerted effort by the UK’s top banks to limit the damage that Brexit could inflict on the City’s status as the world’s premier financial hub. It is expected to be ratcheted up in the wake of the Prime Minister’s “Brexit blueprint speech” last week.
It is understood the move is being spearheaded by prominent City figures John McFarlane, chairman of Barclays and Shriti Vadera, former Labour business minister and Santander UK chairman, through the European Financial Services Chairmen’s Advisory Committee, a lobby group formed following the EU referendum.
Negotiations are being handled by Robert Rooney and Michael Cole Fontayn, the European chiefs of Morgan Stanley and BNY Mellon respectively.
A source close to the talks said: “We are trying to get a permanent agreement for banks with London operations to access the EU. If we can’t do that, what we’ve asked for is a three-year standstill agreement. We don’t want to trigger contingency plans in advance because of a lack of certainty so we are saying 'hold on’.” Last Tuesday, Theresa May revealed that the UK will leave the single market. After the EU referendum vote, the majority of City figures had lobbied for the UK to remain in the trading bloc, which would provide the easiest means for them to continue to provide their services to EU clients.
Banks have more recently expressed hope that the UK and the EU will be able to agree a transitional deal to ensure that the rules under which they operate remain unchanged between the end of the Article 50 process and the adoption of whatever trade arrangements the UK eventually agrees.
The mood among banking bosses assembled at the annual gathering was overwhelmingly pragmatic. Many said Mrs May’s speech had delivered a higher level of certainty and that they now had to get on with making Brexit work for the City.
Bankers have moved from talking about a “transitional” period, instead labelling it an “implementation” or “stability” period, mirroring the language and rhetoric being used by the UK Government.
The positive mood was boosted by an apparent warming of relations between the UK and Germany. Wolfgang Schäuble, the German finance minister, said: “London will remain an important financial centre for Europe.”
Jes Staley, the chief executive of Barclays, said he did not think that the UK or the EU would use Brexit as an excuse to roll back the global financial framework that has been implemented since the financial crisis.
0 comments: