UBS to move 250 London staff because of Brexit
Number expected to be lower than 1,000 initially feared
UBS could move as few as 250 people from London as a consequence of Brexit, lower than the 1,000 it initially feared, because it thinks it will be able to keep many of its back and middle office functions in the City, according to people familiar with the situation.
Sergio Ermotti, the bank’s chief executive, said on Friday that it was becoming “more and more unlikely” that UBS would have to move as many people as it initially thought, because of “regulatory and political clarifications” in recent months.
He did not specify how many of its 5,000 London workers were now likely to move, or what the regulatory and political clarifications were.
A person familiar with UBS’s discussions said that the figure moving now looked closer to the 250 range, and that the clarifications were that UBS expects to be able to book its trades “back to back” in London and another EU location.
Under such an arrangement, trades for UBS’s EU clients would initially be booked in UBS’s EU entity and then offset in the bank’s London entity, where the risk would be managed.
That would mean that back and middle office functions, such as trade processing and risk, could be shared between the two entities and would remain in London.
The person stressed that there was no final decision, and that things could still change as the UK and the EU go through protracted exit negotiations.
A UBS spokesperson said: “Our plans and target operating model are not finalised, so any staff numbers or further details are pure speculation at this point.”
The EU’s banking watchdog, the European Banking Authority, has warned that it will not allow banks to use shell companies in EU countries to retain single market access for businesses that remain in effect UK-based.
The bank has not yet picked a final location for the investment bankers and support people who will move and is still deliberating between Frankfurt, Amsterdam and Madrid.
Mr Ermotti said on Friday that a decision would be taken in a “few weeks”, but insiders said there would not be a public announcement.
Other banks have also subsequently signalled far lower Brexit departure numbers than were initially feared. Citi, for example, said in July that it would add 150 jobs in its Frankfurt hub in the initial phase of its Brexit transition.
With less than 18 months to go until Brexit, most investment banks have applied for the licences they will need for their post-Brexit businesses and some have already begun taking on new property leases in Frankfurt, Paris and Dublin.
Many are adopting a phased approach, moving as few people as they can during what they hope will be a transition period of several years, before deciding on longer term structures.