Omar Ali, EY’s Europe, Middle East, India and Africa financial services leader, said Brexit-driven relocations from the UK and EU have stabilised for now, but more moves could come. Photo: EY

Omar Ali, EY’s Europe, Middle East, India and Africa financial services leader, said Brexit-driven relocations from the UK and EU have stabilised for now, but more moves could come. Photo: EY

The number of operations and staff shifted by major British financial outfits from the UK to the EU due to Brexit has been lower than previously expected, but further transfers are still likely, the consultancy EY has reported.

Financial service firms have relocated relatively few “operations, staff and assets from the UK to Europe” over the past 12 months, as the post-Brexit transition turned out to be less disruptive than feared a few years ago. However, “EY anticipates ongoing operational and staff moves” as market and regulatory conditions continue to evolve.

Job moves

EY pegged “the number of Brexit-related staff relocations to the EU” from the UK at “just over 7,000 as March 2022 closes”, according to the , the consulting firm’s quarterly survey of the largest 222 UK financial services firms, released on 29 March. That is a drop from the 7,400 jobs estimated in December 2021, 7,500 in October 2020, and “significantly down from the peak of 12,500 announced in 2016”.

Omar Ali, EMEIA financial services leader at EY, stated in the report: “The high number of potential job relocations reported in 2016 aligned with the uncertainty which surrounded the City’s ongoing 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.”

Ali added: “While numbers have now stabilised, there will remain a degree of fluidity for some years to come, and staff and operational moves across European financial markets will continue as firms navigate ongoing geo-political uncertainty, post-pandemic dynamics and regulatory requirements, including the ECB’s upcoming ‘desk-mapping’ review.”

The EY report stated that “the number of new hires which have been publicly linked to Brexit since the referendum” rose from approximately 5,000 in December 2021 to 5,400 in March 2022. The consultancy identified 2,900 new jobs in the EU and 2,500 in the UK. Most of the recent gains were “driven by an uptick in the number of staff hired in London.”

Relocation destinations

EY said that “Dublin remains the most popular destination for staff relocations and new European hubs or offices,” with 36 companies moving staff and/or operations moves, followed by Luxembourg (29 firms), Frankfurt (23) and Paris (21). That said, Paris has attracted the largest overall headcount (2,800 former UK employees), followed by Frankfurt (“around 1,800”) and Dublin (“around 1,200”).

Asset managers have primarily selected Dublin (18 firms) and Luxembourg (14). Insurers have most often moved to Dublin (6), Brussels (4), Luxembourg (4) and Paris (2). Investment banks have opted for Frankfurt (19) and Paris (15).

Assets under management

Financial firms have said they would move roughly £1.3trn (€1.5trn) in UK assets to the EU since 2016. “This figure has remained broadly flat over the past 18 months, having climbed steadily from around £800bn in early 2019,” EY stated.

The consulting firm started its EY Financial Services Brexit Tracker on 24 June 2016 and said on Tuesday that it would shut down on 1 April 2022.

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