Dublin remains most attractive location for financial services firms post-Brexit

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Dublin remains most attractive location for financial services firms post-Brexit

Dublin remains the most popular choice for financial services firms to relocate post-Brexit, with 28 firms having committed to relocating staff or operations to the Irish capital since the Referendum, according to EY’s latest Financial Services Brexit Tracker. Dublin is closely followed by Frankfurt (21), Luxembourg (19) and Paris (18).

EY’s analysis estimates the value of the assets that could move from the UK at over €1.1 trillion, up from €936 billion as at 30 November 2018, however this total is likely to increase as Brexit approaches, with total assets of the UK banking sector alone estimated to be in excess of €9 trillion. Meanwhile, the number of jobs that could relocate from the UK to Europe in the near future stands at around 7,000.

For the first time, the EY Brexit Tracker also includes how many Globally Systemically Important Banks (G-SIBs*) have moved operations since the Referendum. G-SIBs are banks whose systemic risk profile is deemed to be of such importance that the bank’s failure would trigger a wider financial crisis and threaten the global economy.

According to the tracker, Dublin is the third most popular location for G-SIBs, having attracted six to the city. Frankfurt is the overall winner with 12, followed by Paris (8). Given their size, many G-SIBs have chosen multiple locations to move operations and/or staff to, however many UK-based G-SIBs are not moving significant parts of their UK business away at this stage. Of the 24 G-SIBs monitored by the tracker, 75% (18) have announced operations and/or staff moves as a result of Brexit.

Commenting on the tracker, Cormac Kelly, Financial Services Brexit Lead for EY in Ireland said, “It comes as no surprise that the ongoing political uncertainty surrounding Brexit is continuing to drive organisations to relocate business, people and balance sheet out of London to European centres, specifically Dublin. We are seeing this first-hand with the arrival of these firms who are taking new office space and recruiting talent as well as seconding experts from their worldwide offices into high value, skilled roles in Dublin. Much remains to do for these firms, however their plans are well underway – plans which are not easy to reverse, certainly in the near term. Whatever the political outcome, it is clear that Ireland is becoming a leading hub for financial services in Europe.”

Prof Neil Gibson, Chief Economist at EY Ireland added, “The results of our tracker are a reminder that while disruption of any kind is challenging, it also bring with it opportunity. Dublin’s place as the most attractive destination for financial services firms relocating reflects its global standing in the sector and shows that the capital is making the most of its potential. Given the challenges that Brexit may present elsewhere in the economy, the jobs and income resulting from these relocations are extremely positive developments which should be welcomed.

Since the Referendum 52% (74 out of 143) of universal and investment banks, wealth and asset managers and insurers monitored by EY’s tracker have publicly confirmed or stated their intentions to move some of their operations and/or staff from the UK to Europe. Furthermore, of the 28 asset managers within this group, 14 have confirmed Dublin as their choice for relocation.

Top relocation destinations

Rank City No. of relocations
1 Dublin 28
2 Frankfurt 21
3 Luxembourg 19
4 Paris 18
5 Amsterdam 6
6 Madrid 6
7 Milan 5
8 Brussels 5

 

Article Published: 20/03/2019