J.P. Morgan Chase & Co. (NYSE:JPM) will move between 500 to 1,000 jobs out of London as the bank begins to implement its post-Brexit plans, according to people familiar with the matter.
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The U.S. bank is planning to bulk up operations in Dublin, Luxembourg and Frankfurt to service clients in the European Union after the U.K. quits the trading bloc. The job moves wouldn't necessarily go just to those three cities but could be spread across a range of European hubs that J.P. Morgan operates across the continent, the people said.
After the two-year Brexit negotiating period ends, the bank will re-evaluate its plans and move further jobs if necessary. At first, a few hundred employees are expected to move but it could reach 1,000 over months, one of the people said.
The move underscores how bank relocations out of the U.K. are becoming a reality as Brexit negotiations get under way. Estimates of how many U.K. financial-industry jobs are at stake vary from a few hundred to 75,000.
In recent months, banks have been putting finishing touches to backup plans to ensure they can still sell products into the EU even if the U.K. is cut off from the bloc. U.S. banks previously concentrated large chunks of their investment banking activities in London to build economies of scale. But now they are having to find ways to partially unwind them.
In J.P. Morgan's case that will mean running its EU custody business out of Dublin, treasury services from Luxembourg and its European investment bank from Frankfurt, one of the people said.
J.P. Morgan staffers have begun compiling paperwork to apply for licenses. The bank had already been perusing offices in Dublin and Frankfurt to increase scale. It remains unclear exactly how many jobs will ultimately be moved to the EU. J.P. Morgan Chief Executive James Dimon has said up to a quarter of the bank's 16,000 staff in the U.K. may have to move.
In recent weeks, other U.S. banks have started to flesh out plans for life beyond Brexit. Goldman Sachs Group Inc. said it would initially move hundreds of jobs to the EU. "We will relocate client-facing people... across a broad range of European markets," said Richard Gnodde, vice chairman at Goldman Sachs, last week. "So we'll have more people in Madrid, more in Milan, more in Paris. And the list goes on."
Goldman has said the job moves will start next year. Morgan Stanley is looking at a number of cities including Dublin and Paris, according to people familiar with the matter.
By Max Colchester and Emily Glazer