By David Henry
NEW YORK (Reuters) – JPMorgan Chase & Co
It is still unclear whether JPMorgan, the largest U.S. bank, would need to hive off slivers or chunks of its UK operations after Britain voted Thursday to leave the EU, Daniel Pinto, who heads the bank’s global and investment banking operations, said in an interview.
Pinto and other decision makers will be listening closely to the tone of comments by EU and UK leaders over the next few weeks to see whether they are inclined to “achieve a deal that disrupts business the least” in the exit, he said.
“The outcomes could range from a very small change to a substantial one, where you would have to duplicate some of the infrastructure you now have in the UK,” Pinto said of the changes JPMorgan might have to make. “It is too early to say what products you are going to be able to provide from where.”
All big banks with UK operations are trying to work out what to do in the aftermath of Brexit. It is a delicate topic for them to discuss because of the risk that their words could harm the coming negotiations, as well as upset employees.
Changes will almost certainly have to be made to continue lending, trading and dealmaking across the newly fragmented bloc of countries. There are a range of cities vying to compete against London as a financial hub, but none of them are quite there yet.
JPMorgan’s European headquarters is in London and the bank has offices in the English coastal city of Bournemouth as well as Scotland. Those locations helped JPMorgan produce $14.2 billion worth of revenue last year from operations across Europe, the Middle East and Africa (EMEA).
It has 16,000 employees across the U.K., though Pinto said it is “very, very premature” to estimate how many of them will need to relocate.
JPMorgan is the world’s biggest dealer in fixed income, currencies and commodities, according to research firm Coalition, and in the immediate aftermath of the Brexit vote on Thursday evening, it handled record foreign exchange trading volumes. At times the bank was processing 1,000 trading tickets per second, according to a memo Chief Executive Jamie Dimon sent on Friday.
“Considering the circumstances,” Pinto said, “it is going relatively smoothly.”
(Editing by Lauren Tara LaCapra and Andrew Hay)