Investment professionals expect less UK presence post-Brexit

Brexit, UK, European Union, EU

The majority of global investment professionals (58 per cent) expect firms from their local market to reduce their presence in the UK following Brexit, figures from the CFA Institute show as it analyses how its members expect June’s referendum to impact the industry.

The survey found 82 per cent of respondents expect London to lose out from the UK’s vote to leave the European Union, while Frankfurt and Dublin were expected to be the main beneficiaries, with 69 per cent and 62 per cent respectively picking them as likely winners.

The majority of respondents (57 per cent) expect Brexit uncertainty to subside in 12 months, 27 per cent think it will remain for two years, and 17 per cent think it will remain for more than two years.

However, in the UK the percentage that expect uncertainty to remain for more than two years rises to 35 per cent.

Chief executive of CFA UK Will Goodhart says: “[The survey results] make challenging reading for the financial services sector in the UK and for the policymakers that will work on the Brexit negotiations. Sixty per cent of EU respondents expect local financial services organisations with a UK presence to reduce that presence.

“The numbers are better from non-EU respondents, where just 44 per cent of respondents expect their local financial services companies to cut back in the UK, but these are disturbing data.”

“A great deal of work will need to be done to maintain the City’s competitiveness as a global financial centre and to secure the broader economic benefits that flow from that.”

UK fragmentation was ranked as the most likely domino effect from the EU referendum over the next decade, with 59 per cent of respondents expecting Scotland was likely to become independent by 2026.

Forty nine per cent said it was likely another European country would choose to leave the EU, however, only 29 per cent of EU respondents thought this was likely.

Only 21 per cent of respondents think it is likely that Brexit will lead to the disintegration of the EU.

However, respondents from the EU were less likely to think another country’s exit was likely with only 29 per cent thinking this was likely.

Seventeen per cent thought it was likely that the UK’s exit from the union would lead to its strengthening into a federal system.

Only 15 per cent of respondents thought Brexit would not eventuate.

The survey, conducted in the second half of July, involved responses from more than 2,000 investment professionals, with half coming from Emea, including 385 from the UK.