Britain's vote to leave the EU has sent
shockwaves through financial markets
joining me here at the FT to discuss
what it means for Investment Banking is
Lauren hoon and our investment banking
correspondent so Laura what does this
vote mean for banks in the City of
London well I think if you look at the
reaction of the banks
share prices it means only bad things
we've seen some very sharp Falls in
share price this morning Deutsche Bank
10 15 16 % UK banks 10 even more or BS I
think was the worst hit down 34% at the
open so certainly investors are very
concerned about this because it does
raise a number of issues for the for the
investment banks many of which have
large operations here in the UK
particularly in the city of London and
they're gonna have to make some very
serious decisions about those operations
now because London has been
traditionally a base and the idea is
that you come here you access all of the
other infrastructure here you have like
legal firms Talent all of that and then
you use London as being the base to
passport into the rest of the EU that
only definitely works if you are in the
EU net it isn't definite that you can't
do that through some kind of a bilateral
agreement down the line but there's
certainly very significant uncertainty
there and that is why we're seeing the
investment banks really get battered
today so is this is this the the party's
over in the City of London now we're
going to see an exodus of jobs of
activity we're going to see a shift to
places like Paris Dublin Frankfurt is
that what's going to happen I think that
you could - I think that you could
confidently say that there are going to
be fewer people working for investment
banks here in three four five years time
than there are now the big question it's
a the big question is in terms of the
size of the shift
so yes buying try going to have to make
alternative arrangements of banks
they're trying very hard not to be
pinned down on those just just now
because we literally have only had the
news in the last 24 hours and banks had
not prepared for this everyone thought
it was going to be an in so banks hadn't
really been seriously constipation they
had made some level of contingency plans
but as things progressed in the last
week or so bank thought this is actually
going to be in this is going to be fine
the banks are really hoping that there's
going to be some kind of a solution
which is going to allow them to keep a
lot of their workforce here in
UK and then after some some of them to
some others other cities which you
mentioned and these big share price
moves that we've seen you know the the
Wall Street Wall Street markets are open
the big US banks are down some eight
eight six percent the likes of Bank of
America Morgan Stanley Goldman Sachs but
the big European banks are down between
fifteen and twenty percent I mean that's
that's many tens of billions of pounds
of value wiped off these big financial
institutions are we talking about a new
financial crisis here well I think when
you look at the performance of the
European banks on your right the
European minds have been very very
severely hiss you should also viewed in
the context of the increase in the share
price of the European banks earlier
earlier in the week so basically as Asia
as it began to look as if it was going
to be an in we saw fairly significant
rises in the European Bank share prices
also in the UK bank share prices also in
the cable race so we are seeing an
element of just taking or just taking
back those increases okay and are there
any silver linings to this I mean
there's some cause for hope and that
there was a lot of concern going into
this on the market side in particular
because we've seen so much contraction
in the liquidity banks are actually able
to to give to the markets because of the
various rules born in the aftermath of
the financial crisis there was a real
fears out in the event of an outpost
that there could be absolute chaos that
the that the banks simply didn't have
the capacity to absorb the kind of
levels of activity the kind of selling
that we were going to see now all the
indications from the banks and it is
early days yet but certainly for the
initial 12 14 16 hours all the
indications are that they have been able
to keep their doors open has certainly
been a very fraught time for them but
there aren't any indications of a
large-scale breakdown Laura thank you
very much thank you