Barclays CEO Says Clarity on Transition Key in Brexit DealBy
‘A two-year cliff is not helpful for anybody,’ he says
Moving a financial center like London is ‘very difficult’
Barclays Plc Chief Executive Officer Jes Staley said banks will need clarity about the transition period for the U.K.’s exit from the European Union, as Prime Minister Theresa May prepares to describe her vision to leaders of the global finance industry Thursday.
“A two-year cliff is not helpful for anybody,” Staley said in an interview with Bloomberg’s Francine Lacqua and Erik Schatzker at the World Economic Forum in Davos. “You can’t function with financial contracts that go beyond two years if there is that cliff,” he said, so “talking about transitions and phase-ins will be important.”
Two days after delivering her vision for pulling Britain out of the European Union’s single market, May will address the World Economic Forum’s annual meeting in Davos, Switzerland, on Thursday and also attend a private session with Wall Street executives. Bankers have started to reveal more about how they will shift jobs to preserve their ability to service the EU market if May’s plan makes London operations unworkable.
JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon said Wednesday “it looks like there will be more job movement than we hoped for.” HSBC Holdings Plc CEO Stuart Gulliver said staff generating about 20 percent of London revenue may move to Paris.
Staley struck a different tone, saying it’s going to be “very difficult” to move a financial center like London to another location. If needed, London-based Barclays may reassign its Frankfurt branch to its Irish subsidiary, he said.
“Same people, same traders, you have to book a trade in Ireland as opposed to London, but that’s not a wholesale move of our capability from London to Ireland,” he said.
Ultimately, he said, the U.K. and the EU have an interest in agreements that benefit both sides.
Governments won’t “preclude a company from managing its liquidity in the most beneficial place,” he said. “Right now that’s most likely London, and I don’t see why that’s necessarily going to change.”