Banks plan Brexit contingencies as prospect of no deal looms

More than a third of large banks and financial institutions are considering or have confirmed moves from the UK.

Banks plan Brexit contingencies as prospect of no deal looms

That’s according to research conducted by Big Four accountancy firm EY, which has tracked the activities of 222 banks and financial institutions following the vote.

It found that the transition period announced on March 19, 2018 has not stemmed the rate at which financial services companies have publicly announced organisational changes in response to Brexit, including staff and operational moves.

Since the referendum in June 2016, 34 percent (75/222) of companies tracked have said they are considering or have confirmed they are moving some of their operations and/or staff from the UK to Europe.

Almost a quarter, 24 percent, of companies tracked have confirmed at least one relocation destination in Europe, with Dublin and Frankfurt remaining the frontrunners, attracting 21 and 12 firms respectively.

According to the House of Commons library, the financial services sector contributed £119bn to the UK economy in 2017, 6.5 percent of total economic output. The sector was largest in London, where 50 percent of the sector’s output was generated.

Omar Ali, UK financial services leader at EY, said: “The transition period, when confirmed, means that we avoid the much-feared ‘cliff edge’, but the level of change to how financial services firms operate will still be significant and the time window to meet these challenges is short.

“Until there is more certainty around key issues, such as the degree of access, movement of people and cross border contract continuity we should continue to expect companies to make operational moves, and prudently stick to their original contingency plans.”