Some of the UK’s biggest firms are already routing business through Europe in fear of what a hard Brexit could do to trade, HSBC has warned.
Britain’s largest bank said some of its top clients aren’t waiting to see what deal the UK strikes with the EU and are voting with their feet.
Noel Quinn, head of global commercial banking at HSBC, said: “A small number of our larger clients are asking us to book more of their trade and foreign-exchange activity in their French operation through our Paris office.”
Executives at multinational firms are “making plans to ensure they can continue to trade regardless of the outcome. They can’t afford to wait for a decision that may not emerge for two years,” he told Bloomberg.
The concern for large companies is that they may lose the right to sell services and goods in the EU, which is why they are putting contingency plans in place now.
Quinn says some large companies, which he did not name, are also considering whether to “flip” their regional head office to a Continental cities.
“Larger companies that already have a pan-European presence are going to find it easier to invoke a Plan B than smaller ones,” he said. “They’re not losing faith in the UK, but the reality is businesses will start making their decisions before the answer emerges from the Brexit process.”