Frankfurt and Paris are set to see a trickle rather than a wave of London bankers arrive in 2018, with the prospect of a softer Brexit discouraging them from leaving Britain immediately, executives and lobbyists say.
Both cities had been positioned to benefit as Britain prepares to leave the European Union, prompting London banks to seek a foothold elsewhere within the bloc in order to continue taking full advantage of the EU single market.
But conciliatory signals from British Prime Minister Theresa May and progress in talks with Michel Barnier, the European Commissioner’s chief negotiator, have prompted some banks to delay large staff moves, at least for now.
Frankfurt’s chief promoter, Hubertus Vaeth, had expected up to 6,000 new arrivals in Germany’s financial capital this year in the event of a hard Brexit. Vaeth said he has now pared back that assessment to less than 1,000.
The small city had been the most popular among banks looking for an EU base. But optimism that Frankfurt could profit has been dampened by the prospect of a Brexit compromise.
“There will be a reluctant, minimal move,” said Vaeth, though he cautioned that this could change in coming years.