The Wall Street banking giant JP Morgan is drawing up plans to merge its UK-based private banking arm into its wider European wealth operation ahead of the UK’s departure from the EU.
Sky News has learnt that JP Morgan is working on the merger, which would then see its UK wealth management arm become a branch of its new EU parent.
Sources said that if it went ahead, the reorganisation would lead to “a small number” of JP Morgan’s roughly 1,000 British-based private bank jobs being relocated to Europe.
The precise figure was unclear, but was likely to be fewer than 100 roles, one insider suggested.
The move, which is intended to allow JP Morgan to continue serving European clients in the UK after Brexit, forms part of the banking behemoth’s wider contingency planning.
A number of alternatives to the private bank merger are also understood to have been considered.
A JP Morgan spokeswoman declined to comment on Wednesday.
Image: JP Morgan Chase’s Chairman and CEO Jamie Dimon
Brexit’s impact on the private banking industry – for which London is one of the world’s most important hubs – has received relatively little attention compared to its potential consequences for broader investment banking activities.
The traffic is unlikely to be all one-way, with Julius Baer, the Swiss private bank, saying this week that Brexit would throw up opportunities to expand in the UK.
“We have opportunities to get business from established players, and the international players are all talking about leaving the UK, not about staying, so there is all of a sudden this interesting window (in the UK),” Boris Collardi, the chief executive, told the Financial Times.
JP Morgan, which was one of the big Wall Street donors to Britain Stronger in Europe, the official Remain campaign, warned before the referendum that it could need to relocate as many as 4,000 UK-based jobs after Brexit.
Jamie Dimon, the bank’s chairman and chief executive, recently told a Paris conference that that figure would be “several hundred” over the short term.
But he warned the same gathering of politicians and financiers: “If the EU determines over time that they want to move a lot more jobs out of London into the EU, they can simply dictate that.
“If regulators say one day we’re not comfortable with your risk people, your lawyers, your compliance being in the UK, they can make us move it.”
JP Morgan has legal entities in EU countries including Ireland, Luxembourg and Germany, but is likely to move some staff to other EU-based operations as well.
Mr Dimon has met Chancellor Philip Hammond and other ministers on a number of occasions since the referendum to urge the establishment of a lengthy transition period to help international banks and the wider business community.