After Brexit, London gets a little help from 4 US banks

London Updated: Jul 07, 2016, 07:51 PM(IST)

Morgan Stanley (file photo) Photograph:( AFP )

Four US investment banks promised British finance minister George Osborne on Thursday that they would help London keep its top spot as a global financial centre following the country's vote to leave the European Union.

Since the June 23 referendum there have been fears of an exodus from the City of London if access to the EU's single market becomes significantly harder. Banks like JPMorgan have said they could move thousands of jobs.

On Thursday JP Morgan, Goldman Sachs, Bank of America Merrill Lynch and Morgan Stanley, as well as Britain's Asia-focused Standard Chartered said they would try to support London's financial sector.

"Today we met and agreed that we would work together ... with a common aim to help London retain its position as the leading international financial centre," the banks said in a joint statement with Osborne.

The statement said no other city in Europe had capital markets as deep as those of London, but the banks made no commitment about keeping jobs in Britain.

The French government pledged on Wednesday to make its tax regime for expatriates the most favourable in Europe in a landgrab for London banking business.

Goldman Sachs and Morgan Stanley have denied speculation they were poised to shift London-based staff and operations to Frankfurt

Jamie Dimon, the head of JPMorgan Chase, said before the referendum that the bank could have to move up to 4,000 staff from the UK in the event of a Brexit vote.

On Wednesday, the municipal authority for the City of London, the district in the capital that is home to many large banks, said the government needed to ensure EU exit talks preserved financial services firms' "passporting" rights that allow them to use London as a base for EU-wide activities.

Osborne, who was senior figure in the failed campaign to keep Britain in the EU, has spent years trying to expand London's role as a global hub for trade in China's renminbi and India's rupee, as well as Islamic finance.

On Tuesday, he met British domestic banks, whose share prices have tumbled since the Brexit vote, and encouraged them to make more funds available for UK lending after the Bank of England eased capital rules.

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