They're not checking their visa applications.

Ignore Traders' Empty Threats to Run Away From Home

Mark Gilbert is a Bloomberg View columnist and writes editorials on economics, finance and politics. He was London bureau chief for Bloomberg News and is the author of “Complicit: How Greed and Collusion Made the Credit Crisis Unstoppable.”
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Banks are starting to fret a little more loudly about the heavier hand of regulation. Some of their complaints, particularly about the dangers ofbusiness petrification caused by excessive caution, are justified. Others, particularly those to do with pay and bonuses, are self-serving and overblown -- and likely to get louder.

The most unappealing bleating from banks and bankers makes them sound like teenagers who threaten to run away from home if their allowance isn't raised. Various forms of this argument -- "if you don't let me stay up late / wear outrageous clothes / play in the derivatives market without the safety net of a capital buffer" -- were deployed in the first half of the previous decade whenever the authorities hinted at an end to self-regulation for the finance industry.

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And now, an incredible 90 percent of senior employees in London's financial district say they'd be willing to abandon the U.K. capital, up from 77 percent a year earlier, according to a survey published by recruitment firm Astbury Marsden last month:

Competing financial centers like New York, Singapore and Hong Kong are free from restrictions on bonuses, giving them an advantage. Traditionally, London has been the location with the most pull for a lot of the best and brightest in the sector, but sharp curbs on bonuses already seem to be prompting more of the City's top-level workers to consider London's big rivals.

The overseers of finance would do well to be skeptical about two classes of banker hyperbole: when banks hint that they might move their headquarters, or when they suggest that limiting how much they can pay their staff will make hiring impossible as traders flee to greener pastures.

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Here's what Royal Bank of Scotland -- a bank now owned by U.K. taxpayers after its investment-banking adventures ended in disaster -- had to say at the beginning of the month:

An inability to attract and retain qualified personnel could have an adverse impact on the implementation of the group's strategy and regulatory commitments.

Translation: Efforts to cap bonuses, plus the Bank of England's plan to introduce a seven-year clawback on bonuses to prevent the kind of short-sighted risk-taking that caused RBS to require a government bail-out, will hobble the bank's revival. That's nonsense.

As is the notion that folk who work in finance are somehow more portable than their peers in law, accounting, consulting, architecture, or any of the other desk-driving professions. Sure, 90 percent of finance professionals might say they'd be willing to move; that doesn't mean they are able to do so. Like everyone else, they have spouses and children, friends, ageing parents and commitments that limit their freedom of movement.

Just because bankers are perceived to be more mercenary than other workers doesn't mean their lives any more portable. Moreover, there really aren't that many cities around the world where you can ply the investment-banking trade. Regulators should ignore the Chicken Little squawking of the finance community. Even for bonus-chasing traders, there's usually no place like home.

This column does not necessarily reflect the opinion of Bloomberg View's editorial board or Bloomberg LP, its owners and investors.

To contact the author on this story:
Mark Gilbert at

To contact the editor on this story:
Max Berley at