Even if the impact of Brexit on the asset management business is still difficult to quantify, the uncertainty is forcing asset managers which are currently based in the UK, to probe on their next moves, in order to ensure that the so yearned unrestricted access to the European single market is retained within their business model.
Indeed, the EU principle of ‘passporting’ is crucial to the presence of certain asset managers in London. The attractiveness of the Europe for asset managers relates mainly to the EU cross border services/products, amongst which are the noticeably successful UCITS and AIFM. More than EUR 1tn worth of business will predictably move out of the UK on this basis.
The next question which inevitably arises relates to which European financial centre is set to win at London’s expense, with the contenders being Paris, Frankfurt, Dublin, Luxembourg and Malta. Whilst Paris and Frankfurt would seem to be the natural choice, rendering it attractive especially to bankers, the latter also being the home of the European Central Bank, most prefer to steer away. Dublin and Luxembourg also offer a respectable alternative, with the former also having the added language advantage. Malta on the other hand, might be the lucky ace of Europe, being a relatively small financial centre which is increasingly gaining popularity having a regulator that is keen to constantly revitalize the Malta offering to grow the industry further. The history that Malta has with Britain, and its current membership in the Commonwealth, cements any current and future working relationship which those asset managers relocating their business there would want to retain with the UK.
Even if the impact of Brexit on the asset management business is still difficult to quantify, the uncertainty is forcing asset managers which are currently based in the UK, to probe on their next moves, in order to ensure that the so yearned unrestricted access to the European single market is retained within their business model.
Indeed, the EU principle of ‘passporting’ is crucial to the presence of certain asset managers in London. The attractiveness of the Europe for asset managers relates mainly to the EU cross border services/products, amongst which are the noticeably successful UCITS and AIFM. More than EUR 1tn worth of business will predictably move out of the UK on this basis.
The next question which inevitably arises relates to which European financial centre is set to win at London’s expense, with the contenders being Paris, Frankfurt, Dublin, Luxembourg and Malta. Whilst Paris and Frankfurt would seem to be the natural choice, rendering it attractive especially to bankers, the latter also being the home of the European Central Bank, most prefer to steer away. Dublin and Luxembourg also offer a respectable alternative, with the former also having the added language advantage. Malta on the other hand, might be the lucky ace of Europe, being a relatively small financial centre which is increasingly gaining popularity having a regulator that is keen to constantly revitalize the Malta offering to grow the industry further. The history that Malta has with Britain, and its current membership in the Commonwealth, cements any current and future working relationship which those asset managers relocating their business there would want to retain with the UK.