The study from EY, which tracks the public declarations of 222 of the largest UK financial services firms over plans to reduce the effect of an uncertain Brexit on operations, highlights the broad-ranging business ramifications of Britain’s divorce from the EU.
“As things stand, and per regulatory expectations, financial services firms have no choice but to continue preparing on the basis of a ‘no deal’ scenario,” said Omar Ali, UK financial services leader at EY.
The £800bn figure was determined using just the public announcements of the companies included in the survey, which means that the number could prove “conservative” according to EY. Not all of the firms that have revealed Brexit plans have publicly declared the value of their transferred assets, it said.
EY said that some asset managers were moving EU customer assets out of UK funds into Luxembourg vehicles to protect clients, for example, while banks were transferring some client business out of the UK and booking balance sheet assets through a European hub.
“This number is still modest given total assets of the UK banking sector alone is estimated to be almost £8tn but may become larger as we move towards Brexit,” EY said.
Companies in the study have added nearly 2,000 new Europe-based roles since the referendum, although the study estimates that the number could rise closer to 7,000 in the near future. [...]
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