- The number of financial services firms to have moved or that plan to move operations, staff and assets from the UK to Europe as a result of Brexit has stabilised over the last 12 months
- Since the UK’s EU referendum, 44% (97 out of 222) of the largest UK financial services firms* have announced plans to move some UK operations and/or staff to the EU – a figure that nearly doubled between March 2017 (53 out of 222, 24%) and March 2021 (95 out of 222, 43%)
- Since the EU referendum Dublin remains the most popular destination for staff relocations and new European hubs or offices, with 36 financial services firms announcing intentions to relocate UK operations and/or staff to the city.
- Since the referendum, 24 firms have publicly declared they will transfer just over £1.3trn of UK assets to the EU – a figure which has remained broadly flat over the past 18 months
Dublin, 29 March 2022: Almost six years post-referendum and five years on from the UK triggering Article 50, the EY Financial Services Brexit Tracker shows that major Brexit-related operational announcements from financial services firms have stabilised, as strategic commercial decisions are increasingly influenced by wider factors impacting individual business needs and operating models.
Staff and operational announcements remain flat after 5-year climb
According to the latest data from the EY Financial Services Brexit Tracker, 44% (97 out of 222) of financial services firms* have now moved or plan to move some UK operations and/or staff to the EU since the referendum.
While this figure hasn’t moved in the last quarter, it has changed significantly over the course of the last almost six years. Amid the ongoing uncertainty around extensions, trade deals and decisions on key factors such as equivalence, the EY Brexit Tracker recorded a steady uptick in firms announcing and acting on operational moves until the end of the transition period (December 2020), and then a slower but still incremental rise until December 2021.
The triggering of Article 50 on 29 March 2017 was a key milestone, by which point in time 24% (53/222) of companies monitored had made public Brexit-related announcements covering intentions to relocate UK staff and/or operations. This rose to 32% (72/222) just over a year later in June 2018 and to 42% (94/222) in October 2020. As firms planned for every eventuality, the EY Brexit Tracker showed that the majority of moves were made well ahead of the December 2020 Brexit deadline and, as a result, the number of announcements on operational decisions has moved very little since that point. It would appear from the data that preparations for Brexit peaked by 2020.
Firms further revise staff relocations downward
Since the transition period ended on 31 December 2020, the EY Brexit Tracker has captured a number of revisions to staff relocation announcements. Over the last quarter, some firms that had initially projected high numbers of staff moves to Europe in anticipation of losing access to the single market, have now revised down the number of roles they will relocate to the continent to serve client needs.
The total number of announced Brexit-related job relocations from the UK to Europe has fallen to just above 7,000 in the last quarter, from 7,600 in March 2021, and 10,500 in March 2017 after Article 50 was triggered. In the immediate months after the referendum in 2016, the total number of planned jobs leaving the UK, according to public pronouncements reached 12,500 as many firms, particularly those in the investment banking sector, prepared for a possible ‘hard Brexit’.
Firms reaffirm commitment to London and the UK
Conversely, the number of new hires which have been publicly linked to Brexit since the referendum across Europe (2,900) and the UK (2,500) has risen to 5,400, from just over 5,000 last quarter (October – December 2021). The increase is predominantly driven by an uptick in the number of staff hired in London.
Fidelma Clarke, EY Ireland Financial Services Brexit Lead, comments: “In the months following the referendum, financial firms voiced their intentions to bolster EU subsidiaries, move staff to the European Union and relocate headquarters in preparation for all possible scenarios. The high number of potential job relocations reported in 2016 aligned with the uncertainty which surrounded the UK’s relationship with Europe at the time. As firms gained greater clarity on what the post-Brexit landscape would look like, plans were consolidated and, in some cases, firms revised down the number of people they would need to relocate.
“Most firms finalised the majority of operational moves well ahead of the 2020 Brexit deadline and were able to serve clients in the UK and EU without undue disruption. While numbers have now stabilised, there will remain a degree of fluidity for some years to come; we expect operational moves across European financial markets to continue as firms navigate ongoing geo-political uncertainty, post-pandemic dynamics and regulatory requirements, including the ECB’s upcoming ‘desk-mapping’ review. Cross-border access remains a priority for both UK and EU firms as they look to create efficient, liquid markets that offer their clients a range of options, and Ireland has remained an attractive destination. Going forward, Brexit-related decisions will be absorbed into businesses’ broader operational considerations in line with their wider growth and transformation strategies.
Asset moves accelerated ahead of the end of the transition period
Since the UK’s EU referendum, 24 firms have publicly declared they will transfer just over £1.3trn of UK assets to the EU. This figure has remained broadly flat over the past 18 months, having climbed steadily from around £800bn in early 2019. The data shows a last-minute increase in firms announcing asset moves in the months before the end of the transition period on 31 December 2020, having learned that the UK-EU trade deal would not offer concessions for the UK’s financial services sector.
Dublin leads as the location of choice for operational moves
Since the EU referendum, 41% (90 out of 222) of firms monitored by the EY Financial Services Brexit Tracker have confirmed at least one location in Europe to which they have moved or are considering moving or adding staff and/or operations. Dublin remains the most popular destination for staff relocations and new European hubs or offices, with 36 financial services firms announcing intentions to relocate UK operations and/or staff to the city. Luxembourg is the second most popular destination for the firms in scope of the EY Brexit Tracker, attracting 29 companies in total, followed by Frankfurt with 23 companies, and Paris with 21. Other named locations include Madrid (8), Amsterdam (8), Milan (7) and Brussels (6).
When it comes to the number of people who have been, or plan to be, relocated to one single destination, Paris scores highest, attracting around 2,800 UK employees, followed by Frankfurt (around 1,800) and Dublin (around 1,200).
Frankfurt and Paris are the most popular relocation destinations for the banking sector, attracting 19 and 15 investment banks respectively, whereas wealth and asset managers have primarily chosen Dublin (18 companies) and Luxembourg (14 companies). Insurers have opted for a variety of different locations, including Dublin (6), Brussels (4), Luxembourg (4) and Paris (2).
Simon MacAllister Partner and Brexit Lead, EY Ireland, added: “Financial services firms faced the upheaval and uncertainty that followed the referendum with pragmatism and focused on minimising the impact of any change on the consumers and the businesses they serve. Contingency plans were enacted to mitigate the impact of a ‘hard Brexit’, and as such, any disruption at the end of the transition period was minimal. The speed and quality of this preparation has meant that almost six years on from the referendum, the UK – and wider European – financial sector has emerged strongly and remains prominent on the global stage.
“Throughout Brexit and the pandemic, we have seen firms across Europe demonstrate resilience, agility and a commitment to the consumers and businesses they serve, which is encouraging as we face into new, geopolitical challenges.”
Notes to Editors
The EY Financial Services Brexit Tracker will cease to track public pronouncements as of 1 April 2022
The EY Financial Services Brexit Tracker was created to provide real time insights on the impact that Brexit was having on the largest financial services firms with significant operations in the UK. Over five years later, financial services firms are no longer making regular public pronouncements. This is believed to be in part because the majority of operational moves were made well ahead of the 2020 Brexit deadline but, as we move further away from Brexit deadlines, it also becomes increasingly complex to disentangle operational decisions relating to Brexit from those that are being taken due to other strategic and commercial imperatives. As such, this is the natural junction to end this research.
*Numbers of financial services firms quoted within this press release are taken from the pre-defined universe of 222 Firms monitored by the EY Financial Services Brexit Tracker
About the EY Financial Services Brexit Tracker
- The EY Financial Services Brexit Tracker monitors the public statements made by 222 of the largest Financial Services Firms with significant operations in the UK across universal banks, investment banks, brokerages, wealth and asset managers, retail banks, private equity houses, insurers and insurance brokers, and FinTechs.
- The Tracker captures public statements made by these Firms on key issues across sub-sectors relating to staffing, domicile, financial impact, policy asks, product changes, remuneration and opportunities.
- Since the Referendum, the EY Financial Services Brexit Tracker has captured the public pronouncements made on key issues across financial sub-sectors in the face of uncertainty and documented the transition from hypotheticals to tangible action.
- As the Brexit Tracker only captures pronouncements of the largest Financial Services Firms with significant operations in the UK, some companies which have made public pronouncements on Brexit are not included in the statistics as they are not contained within the sample.
- The Brexit Tracker runs from 24 June 2016. For this press release, data is complete as of 28 March 2022.
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