LONDON (Reuters) – More than a thousand banks, asset managers, payments companies and insurers in the European Union plan to open offices in post-Brexit Britain so they can continue serving UK clients, regulatory consultancy Bovill said on Monday.
FILE PHOTO: A person walks through the Canary Wharf financial district of London, Britain, December 7, 2018. REUTERS/Simon Dawson
The new offices and staff will help mitigate the loss of business going the other way as the current unfettered two-way direct access between Britain and the EU comes to an end in December following a Brexit transition period.
As a first step, the companies, who until now have been able to serve UK customers directly from their home base, have applied for temporary permission to operate in Britain after Jan. 31 when the UK leaves the bloc, Bovill said, using figures obtained from Britain’s Financial Conduct Authority.
“These figures clearly show that many firms see the UK as Europe’s premier financial services hub,” said Michael Johnson, a consultant at Bovill.
More than 300 financial firms in Britain have opened EU hubs to continue serving clients in the bloc after Brexit, according to a recent survey from New Financial think tank.
The extent of access to each other’s markets after December is subject to negotiations between the EU and Britain, but even the best case scenario is unlikely to cover the full range of financial services.
Bovill said 228 firms from Ireland had applied for temporary permission to keep serving UK clients until they obtain full authorization for a new UK hub.
Dublin is also a popular location for UK-based insurers and asset managers that need an EU hub, reflecting the strong ties between the two countries.
Firms from France, Cyprus and Germany have applied for 170, 165 and 149 temporary permissions respectively, the consultancy said.
“In practical terms, these figures mean that European firms will be buying office space, hiring staff and engaging legal and professional advisers in the UK,” Bovill said.
Reporting by Huw Jones; Editing by Kirsten Donovan