Barclays Preparing to Split Euro Trade Team Amidst Brexit

Photo by Elliott Brown from Flickr

Reportedly, Barclays is preparing to divide its euro trading team amidst Brexit.

The Financial Times that the bank is planning to move a part of the unit that trades interest rate swaps and eurozone government bonds out of its base in London.

Euro trading is an area in the financial services sector that is estimated to be worth billions to the City, and it is also an area that the European Union is determined to take control of following Brexit.

Brussels believes that the said sector, which as of now is chiefly centred on London, must come under the direct supervision of the European Union – and that means that banks that would want to maintain a piece of the market must also relocate their operations to an EU base.

Along with a number of other international and UK banks, Barclays is busily attempting to second guess just what kind of deal the government of the United Kingdom can get for the financial services after March 2019. They are also guessing what effect would the prospect of a no deal, or a deal that will not include them will affect their business.

In the absence of a deal that encompasses financial services, banks and clearinghouses that are based in the United Kingdom will lose their “passporting” rights that enable them to trade securities across Europe from London.

According to the Financial Times, Barclays has not yet decided where the location of its new euro rates trading desk will be based. However, it is anticipated to involve lower than ten traders that are being based in the eurozone.

In a statement, Barclays stated: “Meeting the needs of our clients worldwide is our top priority.

“Barclays continues to plan for all contingencies relating to Brexit to ensure seamless service for our clients.”

Recently, Dublin has been designated as the main European base of the bank outside of London following Brexit.

Some big-name institutions have already announced that they are to relocate some of their staff out of London.

Last week, it was revealed that Goldman Sachs had placed over a dozen banking, sales and trading employees that are based in the United Kingdom on notice to relocate to Frankfurt within weeks.

Some sources informed Reuters that it informed the members of its London-based teams on derivatives and debt capital markets who are working on German accounts that their activities will be moved to its base that is located in Frankfurt and to make the necessary preparations to relocate to those offices by the end of June/

There have been some suggestions that tens of thousands of jobs could be lost to Europe, even though – publicly at least – majority the major players have downplayed the numbers.