JPMorgan Brexit cost $100m and rising
(26 March 2019 – United Kingdom) JPMorgan has allocated over $100 million to Brexit preparations and expects the total bill to increase further as it prepares staff for a potential shift to European countries such as France or Germany in the event the UK crashes out of the European Union (EU) with a ‘no deal’ Brexit.
JPMorgan has requested over 300 staff sign new contracts shifting their roles to France or Germany in the wake of a no-deal Brexit. Affected staff were informed of the eventuality several months in advance however as JPMorgan activates its Brexit contingency plans. The US bank plans to redeploy staff to other roles in order to avoid layoffs. JPMorgan has shifted only a few dozen staff to continental Europe, preferring to wait until absolutely necessary before committing to Brexit moves. Any delay to Brexit means staff moves will also be postponed. JPMorgan staff who are asked to move will be given a six-month package that allows them to commute between London and their new European location. The bank will also pay for temporary accommodation for a similar period of time.
Major banks have been spending millions gearing up for the UK to leave the EU. BAML has spent up to $400 million preparing for Brexit, which has seen the bank move some operations from London to Dublin and Paris. Barclays has spent up to $200 million transferring operations and staff to the EU to prepare for Brexit. HSBC has set aside £128 million as a contingency plan for Brexit, making it the latest high street bank to make provisions in anticipation of bad loans spiking in the UK after the country leaves the EU. The move comes shortly after state-backed Royal Bank of Scotland (RBS) made a £100 million provision in October to account for bad debts rising due to Brexit. JPMorgan CEO Jamie Dimon stated that the extension of the Brexit deadline would not remove uncertainty, and warned that a no-deal withdrawal would be a 'huge negative' for the UK. “Brexit is obviously a negative. It's been a negative for a while” he said.
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