Brexit: Goldman Sachs could move 2,000 jobs out of the UK if it leaves single market, says report

UK banks fear that a so-called hard Brexit will result in the UK leaving Europe's single market 

Click to follow
The Independent Online

Goldman Sachs is drawing up plans to potentially transfer around 2,000 employees to a rival European city should the UK lose its passporting rights, according to a report.

UK banks fear that a so-called hard Brexit will result in the UK leaving Europe's single market and therefore the loss of crucial passporting rights, which allow them to sell their services freely across the rest of the EU and give firms based in Europe unfettered access to Britain.

Goldman Sachs is looking at moving a third of its 6,000 UK workforce to the EU in the event of a so-called “hard Brexit”, the Sunday Times reported citing City sources.

Goldman Sachs has confirmed that it will “continue to work through all implications of the Brexit vote”.

However,  the investment bank added that it has not taken any firm decision on the matter yet.

"There remain numerous uncertainties as to what the Brexit negotiations will yield in terms of an operating framework for the banking industry. As a result we have not taken any decisions as to what our eventual response will be, despite media speculation to the contrary," Goldman Sachs added.

Richard Gnodde, the co-head of the investment banking division of Goldman Sachs said, that “every outcome is possible” when asked if the bank plans would involve moving some of its employees to Eurozone cities in the wake of the EU referendum.

“If passporting was totally removed, we would have to adjust our footprint and where people were located,” Gnodde said at a conference in London in June.

Lloyd Blankfein, chairman and CEO of Goldman Sachs said the bank, which was a big donor to the defeated ‘Remain’ campaign,  has a long history of adapting to change, and will be working  with relevant authorities as the terms of the exit become clear.

“Our primary focus, as always, remains serving our clients’ needs,” Blankfein said.

The future of the passporting arrangements is one of the biggest unknown factors as the UK negotiates its exit from the EU. 

The loss of these rights could be devastating to the City of London as nearly 5,500 firms registered in the UK use passporting rights to operate in other countries.

Last month, Lloyd’s chairman John Nelson, said operations may start leaving London before Brexit negotiations are concluded unless the Government can provide “clarity” about the UK’s future relationship with the EU.

The chief executive of Hermes Investment Management, Saker Nusseibeh, previously said that in order to maintain passporting rights, London will have to be prepared to obey Brussels regulations without the UK having an input into deciding them.

UBS, considered to be the world’s largest manager of private wealth, previously warned that London is likely to see an exodus of finance jobs in the wake of the Brexit vote.