The same banks that said “don’t panic” about Britain’s withdrawal from the EU a year ago are now preparing to make adjustments in their location strategy. Deutsche Bank today was said to be preparing to move around 4,000 jobs from London — or possibly almost half of its staff there. The timing is not known, but it seems a good guess that the peak of the banking exodus from London will be reached in 2019. Other banks are planning similar moves. It is not a situation that calls for moving an entire office from London to another city, though there may be some of that, especially as banks move operations to Ireland. It is more that London has lost its magnetic power to centralize international banking operations. Places as far-flung as Cyprus and Singapore are picking up some of the work that previously might have been squeezed into a London tower. Thousands of jobs, of course, will not move anywhere, but will just disappear.
There is no chance that London could retain its past financial glory, just as New York after the evacuations of 2001 has never regained its weight as a center of finance. New York maintains its reputation as a money center largely by associating itself more closely with Jersey City, across the river, than it had to previously. Similarly, London will in all probability remain a deal-making center, but that will not make it a power center the way it is now. Dealmakers will have to depend on — and answer to — providers in other cities who will conduct the transactions signed in London.