Five U.S. investment
banks offer support for London after Brexit vote
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[July 08, 2016]
By David Milliken and Lawrence White
LONDON (Reuters) - Five U.S. investment
banks promised British finance minister George Osborne on Thursday that
they would try to help London keep its top spot as a financial center,
but gave no commitment on jobs following Britain's vote to leave the
One banker at the meeting with Osborne told Reuters the banks wanted to
see concrete moves to ensure firms based in London would retain access
to EU markets, however, because "no one in their right mind" would
currently invest in Britain.
Since the June 23 referendum there have been fears of an exodus from the
City of London if access to the EU's single market becomes significantly
harder. Banks like JPMorgan <JPM.N> have said they could move thousands
On Thursday JPMorgan, Goldman Sachs <GS.N>, Bank of America Merrill
Lynch <BAC.N> and Morgan Stanley <MS.N>, as well as Britain's
Asia-focused Standard Chartered <STAN.L> said they would try to support
London's financial sector.
"Today we met and agreed that we would work together ... with a common
aim to help London retain its position as the leading international
financial center," the banks said in a joint statement with Osborne.
Citi <C.N>, which had been unable to attend the meeting, signed the
statement later on Thursday.
The statement said no other city in Europe had capital markets as deep
as those of London, but the banks made no commitment about keeping jobs
Banks at the meeting sought immediate reassurance over the fate of EU
staff currently working in London, and urged a pragmatic approach to
quickly ensure Britain retained access to the EU single market.
But any permanent trade deal is likely to be years away, given the
normal length such agreements take and the political vacuum as Britain's
ruling Conservatives picks a new leader.
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The French government pledged on Wednesday to make its tax regime for
expatriates the most favorable in Europe in a land grab for London banking
Goldman Sachs and Morgan Stanley have denied speculation they were poised to
shift London-based staff and operations to Frankfurt.
Jamie Dimon, the head of JPMorgan Chase, said before the referendum that the
bank could have to move up to 4,000 staff from the UK in the event of a Brexit
Osborne, who was senior figure in the failed campaign to keep Britain in the EU,
has spent years trying to expand London's role as a global hub for trade in
China's renminbi and India's rupee, as well as Islamic finance.
On Wednesday the Lord Mayor of the City of London, the district in the capital
that is home to many large banks, said the government needed to ensure EU exit
talks preserved financial services firms' "passporting" rights that allow them
to use London as a base for EU-wide activities.
Osborne has said Britain needs to ensure a heavy emphasis on trade ties,
including financial services, in EU exit talks.
On Tuesday, he met British domestic banks, whose share prices have tumbled since
the Brexit vote, and encouraged them to make more funds available for UK lending
after the Bank of England eased capital rules.
(Additional reporting by Andrew MacAskill, editing by Jeremy Gaunt and Toby
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