CEO of JPMorgan Chase & Co, Jamie Dimon, has warned of the possibility of relocating several thousand employees from the UK if the country’s breakaway from the European Union adversely impacts on the banks.
His comments come just a day after Finance Magnates reported that some of London’s hedge funds and private equity managers are starting to look at shifting their operations into continental Europe.
Passporting Rule
According to sources quoted in Bloomberg, Dimon questioned whether the UK could win continued use of the 'passporting' rule, which currently allows companies with UK operations to sell their services to the remaining 27 nations in the union. If not, it would force him to contemplate moving some of his 16,000 UK-based staff.
The warnings about job losses indicate the challenges which will be faced by the UK’s next prime minister in negotiating the terms of separation with the EU. With nearly three months to go before a new leader is elected, the situation fuels further uncertainty among executives, limiting the likelihood they will invest or hire in Britain.
JPMorgan currently rakes in nearly $8 billion in annual income from the UK with around 9,000 staff in London alone and another 7,000 across the country.
Dimon commented: “Brexit has put a lot of uncertainty in the markets and in the economy. The markets will calm down a little bit," and concluded: “Maybe you can even reverse Brexit. There are always solutions to the problems, as long as you have the right people in the room.”
Property Funds Withdrawals Frozen
Four property funds were also reported to have frozen withdrawals on Wednesday as investors continued to dump real estate holdings, lifting the total of suspended assets to more than £15 billion ($19.4 billion).
Jim Reid, a strategist at Deutsche Bank, told clients: “Property is an illiquid asset and this week shows what can happen to illiquid assets when the fundamentals change. This is perhaps a glimpse of what the future might hold in the next recession for other assets.”
