Tuesday, July 11, 2017
UBS CEO says London jobs could go to Frankfurt, Madrid or Amsterdam
Swiss bank UBS is weighing up whether to move banking jobs in London to Frankfurt, Madrid or Amsterdam to cope with Britain's planned departure from the European Union, Chief Executive Sergio Ermotti said in an interview with CNBC.
With around 5,000 employees based in London, UBS is reviewing where it might move jobs which require access to the EU.
"I think Frankfurt is a location of choice. There are different, other locations that could come into consideration," Ermotti said in the interview broadcast on Monday, according to a transcript.
"I think about Amsterdam, I think about Madrid ... As we speak, we are narrowing down really the options."
UBS will make a decision by the end of the summer or the early part of the fourth quarter, Ermotti said.
Financial services firms need a regulated subsidiary in an EU country to offer products across the bloc which means some are looking to move jobs out of Britain if it loses access to the European single market.
Frankfurt has been mooted as a possible destination for UBS jobs that move from London because last year it set up a bank there to consolidate most of its European wealth management operations.
But other European cities, including Madrid and Amsterdam, are competing to attract bankers if they move from London.
Ermotti also said clients at UBS's flagship wealth management division have shown a greater willingness to invest more of their money in the last five months.
"It's clear if I look at the cash balances as a percentage of wealth we manage, they have been coming down from the high-20s to around the mid-20s," he said.
"So this is clearly a sign that people are willing to invest more, but still very cautious."
In the United States, Ermotti said optimism surrounding the Trump administration had diminished since the start of the year.
"People do still believe that we will see some positive news from the new administration," he said.
"But the goodwill is eroding very fast and people want to see concrete actions before engaging in M&A, before engaging into major discussions in respect of strategic moves."
UBS reports second-quarter results on July 28.