JPMorgan’s Raghavan Sees Brexit ‘Pandemonium’ Without Transitionby
Full EU market access and lengthy transition key objectives
No rival hub to London will emerge after Brexit, Raghavan Says
A senior executive at JPMorgan Chase & Co. called on U.K. and European regulators to strike an interim agreement to allow banks in London to continue to provide services across the EU on broadly similar terms beyond the end of the two-year negotiation period for a Brexit.
"Because if that doesn’t happen, if you suddenly pull down the shutters at the end of year two, then you are going to have pandemonium," Viswas Raghavan, deputy chief executive officer for Europe, the Middle East and Africa, said in an interview at Bloomberg Markets Most Influential Summit in London on Wednesday. "You have to make sure it is orderly."
The world’s biggest banks are waiting for British lawmakers to clarify when the country will begin to exit the European Union and what form the departure will take after voters opted to leave the bloc in a June referendum. They’re concerned that Prime Minister Theresa May is prepared to accept that Britain may have to accept loss of membership of the single market to achieve the immigration restrictions that voters favor.
Raghavan said he didn’t expect any single city to emerge as a winner after Brexit because banks would likely relocate staff across the continent. That risks reversing 20 years of centralization, which has made London a one-stop shop for companies seeking finance, he added.
“Net, net everyone ends up a loser, or worse off," Raghavan said. "There’s a real opportunity here in trying to preserve the integrity of the whole because all of Europe benefits from the whole."