How big is Brexodus — the flight of business and people from the City of London in parallel with our exit from the EU? I observed recently that squealing from the Square Mile has been minimal compared to sectors that make and move physical goods — suggesting that banks, insurers and investment houses have quietly completed all the necessary rejigging of domiciles and compliance that will permit them to carry on making money willy-nilly.
There’s been plenty of paddling beneath the City surface. A report by the New Financial thinktank ‘identified 275 firms in the UK that have moved or are moving some of their business, staff, assets or legal entities from the UK to the EU’. Its conservative guess is that £900 billion has left London so far; in terms of company relocations, Dublin is ‘by far the biggest beneficiary’ at 100, ahead of Luxembourg (60), Paris (41), Frankfurt (40) and Amsterdam (32).
The Irish, angry about the border and Brexit damage to other parts of their economy, have hardly trumpeted this gain. The French by contrast, having pitched hard to win business from les rosbifs, have made much of the meagre news that their own BNP Paribas, Crédit Agricole and Société Générale have moved 500 desks back to Paris, while HSBC has redomiciled a handful of subsidiaries in France. Frankfurt has taken in assets and jobs from the likes of Goldman Sachs, JPMorgan Chase, Morgan Stanley and Citigroup, but has also had to put up with endless sneers about how no banker’s wife would seriously relish moving from Holland Park to Sachsenhausen. Amsterdam’s consolation is a new European hub for NatWest Markets, bringing only about 100 City jobs.
Does all this add up to a lot or a little? None of these destinations come close to rivalling the mass of financial activity, floor space and skilled staff that have long sustained London’s pre-eminence. Demand for new offices in Canary Wharf, I hear, has never been stronger. And yet — as I also hear from senior City voices — we’re entering an era in which London will be seen as a less prestigious, potent and convenient deal-making arena that also carries the risk of Corbyn seizing power out of chaos. Big-hitting US financiers may decide it’s easier to do business from the place they feel most comfortable, flying into the hell of Heathrow or the tedium of Frankfurt only when they have to. On this theory the biggest Brexodus winner is none of the above, but London’s only real global rival: New York.