More than 40 financial companies have drawn up plans to transfer activities to the Grand Duchy. However, this does not seem to have been at the expense of hiring in London, with the trend mostly to add additional people on the ground to support existing UK functions. This has been noted in oversight, product related and transfer agency roles and more broadly in investment risk, sales, marketing and compliance, with firms like Schroders, Wellington, M&G Jupiter and Bluebay expanding their teams in Luxembourg. This is in addition to the 100 or so insurance companies benefiting from the cross-border distribution of life insurance and a major captive reinsurance domicile.
Since joining the EU in 2004 Poland has established itself as a major offshoring site for banks, with estimates of financial services jobs moved from all Western countries ranging from 35,000 to 45,000. Now it has set its sights on more sophisticated middle office functions such as treasury, risk management, and product development, with the likes of Credit Suisse and UBS among those basing large operations in the country, taking advantage of a well-educated workforce as well as cheap office space and wages. But for many this decision was taken well before the Brexit result, driven by the added attraction of being able to support the European timezone and pass the book between regions.
Frankfurt may not have particularly attractive tax rates, English as a primary language, or Ireland’s regulatory framework; but Germany does have the largest economy in
Europe, with strong and steady economic growth. Over the last twelve months, 10 foreign banks have chosen to move operations and staff from London to Frankfurt, lifting the city’s total tally of “Brexit banks” to 25. Among the lenders are Goldman Sachs, Citi, JPMorgan and Barclays. However, as German banks are simultaneously cutting jobs, the net effect is likely to be unclear long-term.
The labour and tax reforms implemented by Macron have facilitated a successful financial services blitz, which has seen BlackRock, JPMorgan, Bank of America, Citigroup,
HSBC, and Nomura all commit to more hiring in and relocations to the French capital. Ultimately, it is projected that these reforms will contribute to circa 3,500 financial services jobs being redirected from London to Paris, which already boasts a strong financial services scene and three of Europe’s biggest banks: BNP Paribas, Crédit Agricole, and Société Générale.