- Other banks said to be approached by IDA investment agency
- IDA proposes banks move trading, support staff from U.K.
The Irish government is targeting banks including Standard Chartered Plc and Royal Bank of Scotland Group Plc as it seeks to lure finance jobs to the country should the U.K. opt to exit the European Union, people familiar with the discussions said.
IDA Ireland, the foreign investment agency, has already pitched to U.K. and international lenders including Standard Chartered about relocating hundreds of traders and support staff, the people said, asking not to be identified as the discussions were private. The agency is pushing towns like Shannon in western Ireland as ideal destinations for administrative employees because they offer low costs and ample office space, one of the people said.
The U.K. will vote June 23 on whether to remain part of the EU. London’s financiers have warned a so-called Brexit vote will prompt overseas banks to move jobs elsewhere, because some financial products can’t be traded outside the EU without specific agreements.
“Brexit could initially challenge the current operational structures of some U.K. and international banks which do cross-border business” and require “re-engineering to ensure access to the single market,” Carlos Suarez Duarte, an analyst at Moody’s Investors Service, said in a report this month.
IDA Chief Executive Officer Martin Shanahan told the Irish Independent newspaper in March that he had met with “some financial services companies” and discussed Brexit, without providing specifics.
“Encouraging investment into regional locations outside of Dublin is a key part of the IDA Ireland’s strategy,” the agency said in an e-mailed statement Monday, declining to comment further. Standard Chartered and RBS declined to comment.
IDA Ireland, based in Dublin, is charged with luring overseas firms to the country, which has a 12.5 percent corporate tax rate, the lowest in Western Europe. More than 1,200 foreign companies, including Facebook Inc., Apple Inc. and Pfizer Inc., have operations in Ireland, and the government wants 900 new “investments” by 2019, according to the state agency’s website. Amid a dearth of office space in Dublin, the IDA is building so-called “advance office facilities” outside the capital.
Banks that have moved some operations to Ireland include Credit Suisse Group AG, which said in December that it will make Dublin its primary hub for servicing hedge funds in Europe and move staff from London. The company, which considered London before settling on Ireland, will employ about 100 people in connection with the trading floor.
Financial CEOs who have discussed the implications of Brexit include Stuart Gulliver of HSBC Holdings Plc, who said in February that the lender would probably need to move about 1,000 investment bankers linked to operations governed by MiFID II, the EU rules covering everything from derivatives trading to bond pricing, to Paris.