The boss of one of Wall Street's most powerful firms has used an event attended by hundreds of its clients to warn Theresa May that staff relocations to London's rival financial centres are inevitable as Brexit looms.
Sky News has learnt that James Gorman, Morgan Stanley (Xetra: 885836 - news) 's chairman and chief executive, told the Prime Minister that other cities had made compelling approaches to lure parts of its business from London during the nine months since the EU referendum.
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Mr Gorman's on-stage remarks, which a spokesman confirmed he made alongside other comments about Morgan Stanley's continuing commitment to the UK, were made at an event held to mark the 40th anniversary of the investment bank's arrival in the UK.
He is said to have surprised a number of people with his comments at the reception, held at the British Museum on March 9, and which was attended by prominent British businessmen including Douglas Flint, the HSBC chairman, and Martin Gilbert, chief executive of Aberdeen Asset Management (Frankfurt: 899502 - news) .
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One person who was there said many of those present felt that Mrs May's conciliatory remarks at the event about seeking to protect the UK financial services sector had been "thrown back in her face".
"He wasn't very diplomatic, given that the Prime Minister had given up her time to speak at an event for Morgan Stanley's clients," said one of those present.
In her letter notifying the European Commission of the UK's departure, Mrs May wrote: "We also propose a bold and ambitious Free Trade Agreement between the United Kingdom and the European Union.
"This should be of greater scope and ambition than any such agreement before it so that it covers sectors crucial to our linked economies such as financial services and network industries."
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The reference to financial services - whose inclusion would be rare in a free trade agreement - and Mr Gorman's remarks earlier this month underline growing anxiety about a so-called 'cliff edge'.
The move to trigger Article 50 prompted a flurry of staff memos to be circulated by Wall Street banks, many of which were among the financial backers of the Britain Stronger in Europe campaign to remain in the EU.
Robert Rooney, the chief executive of Morgan Stanley International, told the bank's staff: "Throughout the process, our main objective has been to ensure that we can continue to serve our clients whatever the outcome of Brexit.
"As prudence would dictate, we have been preparing for a worst case scenario, in which we would need to establish a more significant entity within the EU 27.
"We have had a strong franchise and material presence in the EU 27 for many years, with offices in Budapest, Frankfurt, Paris, Milan, Madrid, Dublin, Stockholm, Amsterdam, Luxembourg and Warsaw.
"Our franchise and presence in Europe gives us many options and we intend to fully leverage those offices and licenses that we already have.
"With (Other OTC: WWTH - news) the triggering of Article 50, we continue to monitor the situation very closely and, when appropriate, will take the necessary decisions and begin to execute on our plans."
Mrs May had met with Mr Gorman, along with the heads of other US financial institutions, in Davos in January.
Wall Street banks have warned consistently that the loss of access to the EU's "passporting" regime, which enables firms to trade seamlessly across Europe's borders, would lead to them relocating jobs from London.
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Goldman Sachs said last week that some roles were already beginning to shift.
The eventual outcome of banks' decisions will largely be determined by the scope and duration of a future deal enabling them to continue serving clients across European borders from the UK.