TP ICAP May Move 60 Brokers From London After No-Deal Brexit

(Bloomberg) -- The world's biggest interdealer broker will shift as many as 60 brokers out of London if Prime Minister Boris Johnson crashes the U.K. out of the European Union without a Brexit withdrawal agreement.

TP ICAP Plc is firming up plans to move brokers to hubs such as Paris and Frankfurt as the likelihood of a no-deal exit intensifies, Chief Executive Officer Nicolas Breteau said in an interview.

“If we have a hard Brexit, we will potentially move people to take care of relationships from EU-based clients that are handled currently from London,'' he said. “We might move 30-60 people but we may also hire people locally to cover these relationships.''

TP ICAP is one of the few firms to disclose no-deal plans since Johnson took the premiership last month, although many financial companies have previously warned of a looming jobs exodus.

The company has already announced plans to relocate its iSwap electronic rates platform to Amsterdam. It created three new EU venues to prepare for Brexit, all of which are authorized and trading with clients. It has also set up and capitalized a new company in Paris that now contains its French and German trading branches. No brokers have been moved out of London so far.

London-based TP ICAP, led by 51-year-old Frenchman Breteau, was formed from the merger of Tullet Prebon and ICAP's voice broking unit in 2016. The firm has 2,706 brokers who match trades worth billions of dollars a day for clients such as JPMorgan Chase & Co. It has European offices in Paris, Madrid, Amsterdam and Frankfurt.

Read More: Whatever Happens to Brexit, Here's the Damage to Britain So Far

The company said its costs had increased because of Brexit as it released first half results earlier Tuesday. While 90% of its broking revenues are largely unaffected, Brexit remains a significant regulatory and operational challenge, it said.

Its new EU structure would help customers such as German asset managers that must be serviced by an EU-based broker, in the event that the U.K. does not achieve an equivalence ruling under the terms of its exit.

“A client could call in the U.K. but the U.K broker can't solicit those clients, so to continue to have good handling of those commercial relationships we will need people on the ground,'' said Breteau.

To contact the reporters on this story: Viren Vaghela in London at vvaghela1@bloomberg.net;Silla Brush in London at sbrush@bloomberg.net

To contact the editors responsible for this story: Ambereen Choudhury at achoudhury@bloomberg.net, Marion Dakers, Ross Larsen

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