Jamie Dimon, the chief executive of US investment bank JP Morgan, has warned that more than a quarter of the US investment bank’s staff in the UK may have to leave for continental Europe if there is no deal on Brexit.
Dimon was at the World Economic Forum in Davos, an annual meeting that “aims to rededicate leaders from all walks of life to developing a shared narrative to improve the state of the world”.
Dimon said: “If we can’t find reciprocal recognition of rules – and there are a lot of people who are mad with the Brits for leaving and want their pound of flesh – then it could be bad. It could be more than 4,000.”
Image: The Global Economic Outlook: Overview WORLD ECONOMIC FORUM/swiss-image.ch/Photo Moritz Hager
In the midst of referendum campaigning in 2016, JP Morgan had claimed that up to 4,000 jobs could go if the UK voted leave, prompting many to accuse them of engaging in the much maligned ‘Project Fear’. Such dire forecasts on the UK economy post-Brexit were seen by some as an attempt to scare voters into voting to remain in the European Union and served to strengthen their resolve to vote ‘out’. Incidentally, JP have recently downplayed that figure, instead estimating that between 500 and 1,000 roles could move.
However, Dimon pointedly referred to a common concern amongst those in the City; that a lack of agreement on financial services cross-border trade could seriously damage London’s status as a global financial hub over the long term.
Investment banks in the City of London are facing tough decisions post-Brexit (Source: Getty Images)
Goldman Sachs boss, Lloyd Blankfein, also an attendee at the World Economic Forum, informed the media that some steps taken by the Wall Street bank to prepare for Brexit were “not going to be undone”. The steps he alluded to include the bank taking out ten floors in a new building in Frankfurt in preparation for March 2019, when the UK formally leaves the European Union.
Financial firms in the City are concerned with the perceived lack of progress in Brexit trade talks, with City bosses meeting with Prime Minister Theresa May and Chancellor Phillip Hammond at Number 10 earlier this month to press for swifter progress in talks with the European Union. The EU has insisted that Britain’s financial services industry will not be afforded the luxury of a ‘special deal’, separate to that of the UK with the EU at large.
In response to this, Swiss investment bank UBS – which employs 5,000 people in London – told investors earlier this week that it planned to implement its Brexit contingency plans early this year. The Bank of England and consultancy firm EY have warned that as many as 10,000 City jobs could go by March next year without a Brexit trade deal.