Nearly two years after Britain’s vote to leave the EU and with the departure date just months away, most large fund companies have still to unveil contingency plans.
Just 22 of the largest 57 asset and wealth managers with significant operations in the UK have announced plans to relocate staff or operations, according to analysis by EY, the consultancy.
The clock is ticking on companies to put their post-Brexit plans into action as watchdogs in popular EU fund management hubs such as Luxembourg and Dublin are struggling to cope with the demand for their regulatory approval.
There is also fierce competition to hire staff in these locations. Lawyers have warned fund companies against complacency due to the comfort of the proposed Brexit transition period.
In the event of a hard Brexit next March, businesses that are ill-prepared risk being cut off from EU customers.
“There will . . . be major structural shifts in relation to products and distribution to allow fund management houses to continue to serve their customers in the event of a hard Brexit, both in the UK and overseas,” said Gill Lofts, UK head of wealth and asset management at EY.
David Morrey, partner at Grant Thornton, the consultancy, said one reason few managers had formally announced plans so far was because some had sizeable EU operations and would not need to make significant changes.
He said most companies had looked into the legal structure they would need, as well as how many workers they would have to move or hire, depending on the scenario. He said few had made announcements on staff issues as these could be sensitive.
Mr Morrey said he expected most asset managers to reveal their plans once a final decision was made over the potential transition period in October or November.
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