Will your banking job, currently situated in the City of London or Canary Wharf, still be situated in the City of London or in Canary Wharf come 2020? Or should you be preparing to decamp to Frankfurt (or maybe even Madrid)?
Fortunately, the banking analysts at BCG have put together a little graphic that answers these questions for you. If you work in M&A, commodities, FX, emerging markets and securitized products, you will be staying in London. If you work in euro denominated derivatives, rates or credit you will be leaving. All else is up for grabs.
Regulation is to blame. Although questions have been raised over whether the EU can really demand that euro-denominated derivatives are cleared within its territory, BCG’s analysts seem to think it can: “Euro-denominated mandated derivatives will likely have to be cleared in Europe,” they say. FX trades, however, are “exempt” from this mandate and will continue to be executed in London which has, “pre-existing infrastructure.”
This does not mean you should go out and buy a family home in Putney if you work in debt capital markets (DCM) or prime services. Regulation isn’t the only force at work here: BCG says some firms will relocate businesses to their home centers to, “concentrate volume and re-invigorate operational scale.”
Photo credit:Thomas Northcut