More reports on: Goldman Sachs

Goldman Sachs CEO warns Brexit could stall London as financial centre

05 May 2017

The chief executive of Goldman Sachs has warned that the Brexit process would stall London's standing as a financial centre.

According to Lloyd Blankfein who ran the world's second-largest investment bank, a three-decade expansion that had turned London's financial services sector into a world leader could grind to a halt.

''It will stall, it might backtrack a bit, it just depends on a lot of things about which we are uncertain, and I know there isn't certainty at the moment,'' Blankfein said in an interview with the BBC. ''I don't think it will totally reverse.''

He added, there would need to be an implementation period of at least a ''couple of years'' after the Brexit deal had been agreed in early 2019 to allow companies to adjust.

''We are talking about the long-term stability of huge economies with hundreds of millions of people and livelihoods at stake, and huge gross domestic product,'' he said. ''So, if it takes a little while, I'd rather get it right than do things quickly.''

If not enough time were factored in, banks such as Goldman would be forced to act ''prematurely'' and possibly move some of their operations and jobs.

Blankfein said that his firm had "contingency plans" to move people depending on the outcome of the negotiations adding the bank would not have to trigger the plans.

He wanted to keep as many activities in the UK as possible.

He said both sides in the Brexit negotiations were playing for very high economic stakes and that there would need to be an implementation period of at least "a couple of years" once the exit deal had been agreed by the spring of 2019.

Over a million people worked in the financial services sector in the UK and it paid over 70 billion a year in taxes to the government, 11.5 per cent of all receipts.

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