City of London affected but not sunk after Brexit

June 29, 2021 is still mask time: Emmanuel Macron in black, JPMorgan boss Jamie Dimon in red. At Place du Marche-Saint-Honoré, the duo officially inaugurated the new Paris premises of the American bank, which had just expanded its offices on Place Vendôme, connecting them to a new building.

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Before Brexit, JPMorgan had 250 employees in the French capital. It has 800 now. The French president himself inaugurated the new trading room, aiming to further showcase the red carpet that French authorities have rolled out to the financial world in recent years. But Paris isn’t the only beneficiary: JPMorgan has also strengthened its presence in Frankfurt, Luxembourg, Milan, Madrid, Stockholm and Dublin. Across the European Union (EU), it doubled its workforce to 6,000.

A blow to the city? Indeed, comparisons with London favor the British capital for the time being. In its massive tower in Canary Wharf, a business district east of the British capital, JPMorgan now employs… 10,000 people. In the UK, the total reached 19,000. It is three times that of the mainland.

“Break your arm on purpose”

This example sums up the reality of the City of London’s shock from Brexit: real, but far from threatening its enormous domination of European finance. “With this vote, it’s as if London has chosen the Severe Arm, William Wright, head of financial think tank New Financial, sighed. Usually, no one does this on purpose. But it was just an injury, not fatal. »

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It has been nearly seven years since Brexit was passed, but only two years before it became a corporate reality, when the UK officially left the European single market on January 1^Well January 2021. that day “Financial Passport”A deal allowing financial products to be sold across the EU from London was lost. The turning point is historic, but the pandemic initially made it difficult to assess the aftermath.

Today, initial assessments are available. Consulting firm Ernst & Young added up all the announcements from 222 financial firms and came up with…7,000 outsourcing jobs. By definition, this is an understatement: there is no obligation for companies to announce their relocation, and small companies are not part of the group. “Reality is at least double or triple”, argues Nicolas Mackel, a lobbyist for the Luxembourg financial center. Or maybe 5% of the city.

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