Brexit: Lord Frost says Brexit will 'bring politics home again'
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The European Central Bank has been trying to crack down on banks serving EU clients from the UK in the wake of Brexit. The practice is known as “back-to-back” trading.
Banks could face fresh pressure to move staff from Britain to the bloc as the ECB’s desk-mapping exercise enters its final phase in the coming weeks.
The ECB has been assessing the EU arms of US banking giants including JP Morgan and Goldman Sachs.
Insiders told the Telegraph that JP Morgan and Goldman Sachs have already increased their EU workforce by 1,800 due to Brexit.
The increase was a combination of relocating London bankers and new hires.
Meanwhile, the Bank of America Merrill Lynch has added 500 roles on the continent.
And Morgan Stanley has bumped up EU staff by 300.
It comes as the ECB has been looking to tackle the “back-to-back” trading practice of banks serving EU clients while keeping staff and capital in the UK.
Next month the ECB enters the final stage of its desk-mapping review.
Banks relying too much on their London operations are braced to come under fire.
However, some banks have faced strong opposition from staff to relocations.
Last July, Bloomberg reported that when JP Morgan asked a team of 15 traders to move from London to Paris around half of them quit.
The US publication reported that other banks including Goldman Sachs have experienced similar issues.
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It comes as the EU confirmed on Thursday inflation has climbed to its highest level in the history of the Eurozone at five percent for December.
Despite the pressures, the ECB has held off any movement on interest rates.
In an interview with France Inter radio station, ECB President Christine Lagarde insisted inflation would “stabilise and ease gradually in the course of 2022”.
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