MarketAxess, one of the world’s largest corporate bond trading venues, has chosen Amsterdam as its main base for the EU after the UK leaves the single market.
The US group, which has a market capitalisation of more than $7bn, is to press on with plans to set up a regulated entity in the Netherlands, chief executive Rick McVey told the Financial Times.
Although many banks and insurers have gone public with their post-Brexit plans, MarketAxess is the first trading venue to do so. For the past 15 years, the technology driven MarketAxess, which employs just 405 people globally, has used London as the launch pad for its EU operations. Its European customers traded on average nearly $1.5bn in credit products a day in the first half of 2017, more than double the volume two years ago.
Mr McVey said the company’s decision was driven partly by the uncertainty around a potential transitional period to smooth the UK’s departure. Although UK ministers appear to be moving towards an agreement that favours business groups, British-based companies currently face disruption if the UK crashes out of the EU in 2019 without an agreement.
“As time goes on, the momentum is now shifting towards contingency planning,” Mr McVey said. “We’re hoping [no transition deal] is not the case but we’re preparing for the worst. We mean to be fully regulated and ready to go well ahead of Brexit.”
More financial services groups are going public with their plans to ensure they can continue to service EU clients. Last week, Bank of America said it had picked Dublin as the main base for its EU investment banking and markets operations, while it emerged that Citigroup, Morgan Stanley and Deutsche Bank will be beefing up operations in Frankfurt, the German financial capital. [...]
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