UK’s Brevan Howard moves staff overseas
Brevan Howard, the world’s third-largest hedge fund, has moved most of its operations out of the UK, shifting dozens of jobs to the Channel Islands, Switzerland, Asia and the US to escape EU regulation and grow internationally. Three years after opening a satellite office in Geneva, Brevan – which has $41bn under management – now only has a "handful" of traders left at its London office and has moved out many of its senior operational jobs, people familiar with the company told the Financial Times. The publicity-shy hedge fund, which specialises in placing bets on movements in interest rates and bonds, employs more than 450 people worldwide. Fewer than 200 are now in London. As recently as four years ago, almost all of its employees were based in the UK capital. Brevan’s decision to shift business offshore comes as the EU’s sweeping new Alternative Fund Manager Directive, a law aimed at regulating hedge funds, is launched in the UK. Most of London’s $300bn hedge fund industry has accommodated itself to the new rules – which have proved to be far less onerous than many fund managers feared they would be. The Financial Conduct Authority, the UK regulator, has also sought to moderate some provisions to appease London-based fund managers’ concerns. Brevan – founded by the billionaire trader Alan Howard – has nevertheless continued to blanch at Brussels’ interventionism and believes that EU politicians could seek to impose further curbs on hedge fund activities in the future. Mr Howard moved himself and a clutch of top traders to Geneva in 2010. Although speculation has recently mounted about whether he would return to the UK, Mr Howard has told traders at the company he will be in Switzerland until at least the end of 2014. The company has meanwhile shifted its centre of gravity out of London in a deliberate strategy to "internationalise" itself. By next year, as many as five dozen employees will be based on the Channel Island of Jersey. Although Brevan’s Jersey office has officially served as a headquarters for the company’s holding company since 2005, it previously housed only a couple of administrative jobs. In September Brevan co-founder James Vernon returned to the hedge fund – having retired in mid 2011 – to spearhead operations on the island. Mr Vernon will play "a key role in the ongoing development of the Jersey office", Brevan said at the time. Operations on the island now include almost all of the hedge fund’s asset allocation, risk management and compliance and HR functions – jobs that were all previously conducted in London. Brevan’s US presence has swollen too, with 60 employees now based in New York and Washington. As many as 60 per cent of Brevan’s investors are now US-based. The hedge fund is spotting more trading opportunities there, too, thanks to markets’ increasing focus on the policies of the US Federal Reserve and a potential end to quantitative easing. Brevan declined to comment.