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Wells Fargo is planning to move to a new building in 2018. "We will be able to place our whole team in one office to work more efficiently," - said Regional President of Wells Fargo's Europe, Middle East and Africa, Frank Pizzo.
In January, Bloomberg reported about Wells Fargo’s intention to rent, not purchase this building. However, the pound fell against the dollar by 11% almost a month after the Brexit referendum. Kathryn Ellis, Communications Manager at Wells Fargo, did not comment on whether the transaction is related to the pound’s low cost. The only comment she gave was that issue of the staff consolidation in London was planned long before the British referendum. HB Reavis Chief Financial Officer told Reuters that the deal with Wells Fargo shows that the London property market is stable, even though "many doubted its future after Brexit".
According to Bloomberg, Wells Fargo is going to increase its presence in London, although some non-resident banks have already reported that Brexit may force them to transfer some employees to other countries. There are 489 foreign banks registered in the UK, including 183 banks from other EU countries. London accounts for 78% of trading in euro and for 74% of trading derivatives on interest rates. According to UBS estimates, 4% of inhabitants of London offices may move to other countries.
Wells Fargo is famous for the fact that virtually all of its operations are concentrated in the United States. Now, it is suffering from low rates, just like other banks. Since Wells Fargo’s core business is retail, the organization is concentrating on lending now. In II quarter, the bank increased its loan portfolio by $ 10 billion to $ 957 billion, which is more than $ 873 billion from its main competitor, JPMorgan Chase. In II quarter, Wells Fargo earned $ 5.6 billion in net profit ($ 5.7 billion a year earlier), and $ 22.2 billion of revenue (vs. $ 21.3 billion). With its $ 243 billion-worth capitalization, Wells Fargo ranks first among US banks.
Berkshire Hathaway’s billionaire Warren Buffett owns 10% of Wells Fargo. Berkshire, which has become the bank’s investor in 1989, has requested permission from the Federal Reserve to increase its stake in the bank at the beginning of July. «Berkshire asks for permission to retain its shares in Wells Fargo and buy another ordinary shares of the bank - said in its statement. - Berkshire does not plan any transactions in connection with purchase of these shares". Berkshire is not going to change strategy and the bank's corporate culture, nor to demand changes to its board of directors.
After the United Kingdom announced its intention to withdraw from the EU, many financial institutions, technology-based start-ups and international companies started to think about leaving the kingdom. Loss of free movement within Europe is quite a weighty argument to move their business to other European countries, if not totally, then at least partially.
London has long been the financial capital of Europe. However, after the referendum, many financial institutions have decided to transfer part of the business to other European countries. Priority options for moving banks see Paris, Frankfurt and Dublin. These include, for example, large US banks, which London offices employ thousands of people.
JPMorgan Chase, Bank of America, Goldman Sachs, Citigroup, Morgan Stanley - all of them will have to transfer part of the staff outside the UK.
British banks themselves are now also evaluating the possibility to move part of their employees in other countries. Everyone is concerned with future of securities trading and provision of financial products and services to European customers. Institute of Directors estimated that in total, every fifth company based in the UK today intends to withdraw part of its business outside the country.
source: bloomberg.com
In January, Bloomberg reported about Wells Fargo’s intention to rent, not purchase this building. However, the pound fell against the dollar by 11% almost a month after the Brexit referendum. Kathryn Ellis, Communications Manager at Wells Fargo, did not comment on whether the transaction is related to the pound’s low cost. The only comment she gave was that issue of the staff consolidation in London was planned long before the British referendum. HB Reavis Chief Financial Officer told Reuters that the deal with Wells Fargo shows that the London property market is stable, even though "many doubted its future after Brexit".
According to Bloomberg, Wells Fargo is going to increase its presence in London, although some non-resident banks have already reported that Brexit may force them to transfer some employees to other countries. There are 489 foreign banks registered in the UK, including 183 banks from other EU countries. London accounts for 78% of trading in euro and for 74% of trading derivatives on interest rates. According to UBS estimates, 4% of inhabitants of London offices may move to other countries.
Wells Fargo is famous for the fact that virtually all of its operations are concentrated in the United States. Now, it is suffering from low rates, just like other banks. Since Wells Fargo’s core business is retail, the organization is concentrating on lending now. In II quarter, the bank increased its loan portfolio by $ 10 billion to $ 957 billion, which is more than $ 873 billion from its main competitor, JPMorgan Chase. In II quarter, Wells Fargo earned $ 5.6 billion in net profit ($ 5.7 billion a year earlier), and $ 22.2 billion of revenue (vs. $ 21.3 billion). With its $ 243 billion-worth capitalization, Wells Fargo ranks first among US banks.
Berkshire Hathaway’s billionaire Warren Buffett owns 10% of Wells Fargo. Berkshire, which has become the bank’s investor in 1989, has requested permission from the Federal Reserve to increase its stake in the bank at the beginning of July. «Berkshire asks for permission to retain its shares in Wells Fargo and buy another ordinary shares of the bank - said in its statement. - Berkshire does not plan any transactions in connection with purchase of these shares". Berkshire is not going to change strategy and the bank's corporate culture, nor to demand changes to its board of directors.
After the United Kingdom announced its intention to withdraw from the EU, many financial institutions, technology-based start-ups and international companies started to think about leaving the kingdom. Loss of free movement within Europe is quite a weighty argument to move their business to other European countries, if not totally, then at least partially.
London has long been the financial capital of Europe. However, after the referendum, many financial institutions have decided to transfer part of the business to other European countries. Priority options for moving banks see Paris, Frankfurt and Dublin. These include, for example, large US banks, which London offices employ thousands of people.
JPMorgan Chase, Bank of America, Goldman Sachs, Citigroup, Morgan Stanley - all of them will have to transfer part of the staff outside the UK.
British banks themselves are now also evaluating the possibility to move part of their employees in other countries. Everyone is concerned with future of securities trading and provision of financial products and services to European customers. Institute of Directors estimated that in total, every fifth company based in the UK today intends to withdraw part of its business outside the country.
source: bloomberg.com
