Asset managers have started their detachment from London following Britain’s historic vote to leave the European Union (EU), with fund companies finalising plans to reduce their reliance on the capital city.
M&G, Columbia Threadneedle, Legg Mason, Fidelity International and T Rowe Price have all outlined intentions to move staff out of London or set up fund ranges in neighbouring EU countries in fear of being locked out of European fundraising, the Financial Times reported on Sunday.
No asset manager has yet announced it will shift its headquarters away from the city but the retreat has prompted the Investment Association, the London-based trade body for Britain-based asset managers, to hold a special meeting with its members on Tuesday to tackle the fallout from the vote.
Investment companies based in the UK manage 5.5 trillion pounds of assets and employ 35,000 people. Another 25,000 staff work for related entities.
Fidelity International, which opened its office in London in 1973 and manages 190 billion pounds of assets, has announced it will move 100 staff to Ireland but said the shift was planned before the UK referendum result. It already employs 65 staff in Dublin.
“London has a lot to lose and although it is too early to properly assess what damage the Out vote might have on the city, it is clear people have started making plans to do business elsewhere. Rival centres are on high alert,” the chief executive of a large UK-based asset manager said.
On June 24, Britain voted to exit the EU in a historic referendum after being a member of the bloc since 1973.
It is the first nation to exit the now 27-member bloc.