JPMorgan and Citi say just hundreds of jobs will leave London due to Brexit — not thousands

Dan Kitwood/Getty ImagesTraffic going towards London’s Canary Wharf business district.
  • Executives from JPMorgan, Citi, and Barclays Ireland gave evidence to UK MPs on Tuesday about the impact of Brexit on their industry.
  • All three said their banks expect just 150 roles to be moved out of London in the immediate aftermath of Brexit.
  • The figures suggest that initial estimates of Brexit job losses – some of which were as high as 40,000 – could be wide of the mark.
  • But JPMorgan’s Mark Garvin warned that the figures he offered were just “day one” moves and he can “envision a scenario where those numbers could be substantially larger.”

Executives from three major banks said on Tuesday they expect to move just several hundred jobs out of Britain in the immediate aftermath of Brexit, far fewer than consultants and industry bodies had initially estimated.

Executives from Citi, Barclays Ireland, and JPMorgan told UK MPs serving on Parliament’s Treasury Select Committee that each bank currently expects to move only around 150 roles out of Britain due to Brexit. Between them, the three banks employ over 50,000 people in the UK.

However, while the banks gave low numbers for initial job losses, JPMorgan’s Mark Garvin said job moves could become “substantially larger” over time.

‘Small numbers’

Garvin, vice chairman of JPMorgan’s corporate and investment bank, said earlier in the session that JPMorgan expects job moves out of the UK “in the hundreds” in the first few years after Brexit.

James Bardrick, head of Citi UK and CEO of Citigroup Global Markets, told MPs in the same session that his bank currently estimates that 150 of its 9,000 UK jobs will be relocated to Europe.

“This is more about putting the right people in the right places for the right roles rather than any wholesale change,” Bardrick said.

Kevin Wall, CEO of Barclays Ireland, said 150 roles would likely move from London to Europe as a result of Brexit, adding that 150 new roles would also need to be created as a result of Brexit.

“Those are small numbers,” Wall said. Barclays employs around 30,000 people in the UK.

The figures, which amount to around 450 jobs across the three banks, are far smaller than initial estimates for job losses in UK financial services as a result of Brexit.

The Bank of England estimated last year that 10,000 banking jobs could be lost in UK financial services on the first day after Brexit. Jeremy Browne, the City of London corporation’s special envoy for Europe, estimated in 2016 that the number could be as high as 16,000.

Think tanks and consultancies have been even more bearish. Oliver Wyman estimated last year that as many as 40,000 investment banking jobs may have to be moved to Europe post-Brexit.Brussels-based think tank Bruegel put the figure at 30,000.

‘We just don’t know what will happen in the future’

Despite the lower than forecast job move numbers, Garvin said: “One has to think of this as a process. It’s not a one-off big bang event, it’s a multi-year process. These are what I would call ‘day one’-type arrangements and it’s very hard to speculate on what ultimately may transpire. That will be a function of a number of things.

“First of all, it will be a function of the ultimate arrangements that prevail between this country and the EU. Number two, it will be a factor of what our regulators require … And finally, potential policy changes in both of these areas.

“These are the answers today but it’s difficult to speculate what they might be in the future and one could envision a scenario where those numbers could be substantially larger. But that’s as I said highly speculative.”

JPMorgan CEO Jamie Dimon said at the start of the year that as many as 4,000 of JPMorgan’s 16,000 UK roles could be forced out of the UK if Britain doesn’t retain preferential access to the EU market after Brexit.

Questioned on the difference between this 4,000 number and Garvin’s estimates, Garvin said: “The two numbers are not inconsistent. It’s a matter of time. We just don’t know what will happen in the future.”

‘Our London operation is a very, very important’

Citi’s Bardrick was more optimistic, telling MPs: “The numbers we’re giving and the plans we’ve made are for the worst case. When we say 150, 200 people, that’s our worst case.”

Bardrick also emphasised that London would remain a major hub for Citi’s operations globally regardless of the outcome of Brexit.

“Our London operation is a very, very important part of our global organisation,” Bardrick said.

“A significant part of it relates to the services and provision of services and products to clients in the EU. But an even larger bit of it is around our UK and rest of the world activities. It is a truly global operation.”

He added: “London will remain the regional headquarters for our group for the Europe, Middle East, and Africa region, from where we manager 55 country franchises. It will remain the headquarters for a number of our most important product groups globally.”

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