Fund management ‘action’ to remain in London despite Brexit

UK fund managers are considerably more positive about Brexit than their counterparts in Europe, research from alternative assets consultancy MJ Husdon found.

While 50 percent of UK fund managers and investors expect the UK to remain the second largest asset management hub globally after Brexit, most continental respondents said it will drop to third or fourth place.

Regardless of their location, fund managers expect around 17 percent of staff will leave the UK by 2020. But there is more disparity between investors, with those based in the UK anticipating a smaller loss of around 13 percent, while continent-based investors believe the figure will be closer to one-quarter.

The report said that there is a strong business case for firms with a large European investor base to relocate, but those UK-centric or non-EU focused operations are likely to stay put.

“Fund managers with a strong base in the UK [will choose to] keep the main operations in the UK, where most of the action will be for decades to come,” Matthew Hudson, chief executive of MJ Hudson, said.

Those that do choose to relocate should discuss the options with their staff, local lawyers and service providers to make sure they make the right decision, the report added.

“Moving or setting up offices in a new geographical location is not a process to be undertaken lightly. It is logistically challenging and often the process of moving is more complex and difficult than simply staying put and rising to the challenge,” the report said.

While it did find that for some managers the Brexit vote is yet to have had an impact on operations, the research also showed that uncertainty over the UK’s future relationship with the EU was causing concern.

“It will be difficult to keep ahead of the pack if we lose free access to markets,” one UK manager said, while a second asked if “any sane non-UK fund manager would set up in the UK before Brexit is clarified.”