JP Morgan in talks to move all EU serving bankers out of London
Jamie Dimon, the head of JP Morgan, has warned that he could move all bankers serving European Union clients out of London as regulators in Europe seek to poach the City’s business.
In his annual letter to shareholders, Mr Dimon said that Brexit “cannot possibly” boost the UK economy and warned of mass job moves as Brussels seeks to exclude London from its markets. He suggested that the UK would in future be forced to follow the EU’s agenda.
He said: “Brexit was accomplished, but many issues still need to be negotiated. And in those negotiations, Europe has had, and will continue to have, the upper hand.
“In the short run (i.e. the next few years), this cannot possibly be a positive for the UK’s GDP – the effect after that will be completely based upon whether the UK has a comprehensive and well-executed strategic plan that is acceptable to Europe.”
Separately, he said US president Joe Biden’s stimulus package could lead the United States into a “Goldilocks moment” of rapid economic growth.
In the run-up to the Brexit vote, Mr Dimon said that JP Morgan could cut up to 4,000 UK jobs if Leave won, but the bank later scaled back these estimates and said no more than 500 to 1,000 roles would move abroad, The Daily Telegraph reports.
Mr Dimon’s comments come as the Bank of England seeks to prevent an EU power grab. In February, Governor Andrew Bailey warned that there were signs that EU powers could be planning “to cut the UK off from itself”.
In his letter, Mr Dimon said: “It is clear that, over time, European politicians and regulators will make many understandable demands to move functions into European jurisdictions. Because of this – and because of strong European efforts to compete with London – Paris, Frankfurt, Dublin and Amsterdam will grow in importance.”
He added that London could still thrive by seizing the initiative in areas such as online banking. JP Morgan has hired hundreds of British workers in the past few months as it seeks to take on the likes of Monzo by targeting UK households with its own online bank later this year.
Mr Dimon said: “We may reach a tipping point many years out when it may make sense to move all functions that service Europe out of the UK and into continental Europe.
“But London still has the opportunity to adapt and reinvent itself, particularly as the digital landscape continues to revolutionise financial services.”
Banking insiders have said that regulators in the UK and the EU have been asking how and where banks are booking trades in the past few weeks, as foreign rivals hike pressure on firms to move staff from London and British regulators try to defend the City.
According to EY, only 7,600 financial services jobs have so far moved out of the UK due to Brexit, a tiny proportion of roles in the UK’s finance sector and far less than previously predicted.
Xavier Rolet, the former boss of the London Stock Exchange, said at the weekend that he still believes research, which it commissioned in 2016, that suggested 232,000 roles could go.