The easy answer is “no way!” But the situation is more complicated than that. When Brexit officially goes into practice, companies that used to do business through the EU will need passports and other official documentation in order to continue to work in London.
For some, however, that’s not really a roadblock: Henry Kravis of KKR notes that there are likely to be more investment opportunities in London now. And while others are reducing recruiting and pulling out of the area, Steven A. Cohen’s Point72 Asset Management is doubling down on staff and new deals.
Kravis recently described the post-Brexit situation in England as an opportunity for increased deal-making in Europe. Though he does expect a “dislocation” for a time, Kravis indicated that KKR will continue to monitor the company, looking for new potential opportunities. Kravis suggested that Ireland and Luxembourg in particular could have a lot to offer.
Meanwhile, Britain’s 2.2 million financial industry workers face extreme uncertainty while the full effects of Brexit unfold. Stock values from Europe all the way to Wall Street have plummeted as negotiations continue. Investment banks are talking about moving thousands of jobs out of Britain, while the European Central Bank is considering removing euro trading from London, the world’s biggest foreign exchange market.
But KKR isn’t the only firm that still sees opportunity in London. Steven A. Cohen’s Point72 Asset Management has doubled the size of its London workforce in the past several months. Where hedge fund Bridgewater Associates has slowed recruiting and Pershing Square Capital Management is proceeding with layoffs, Point72 has hired Marc Desmidt as head of international strategy. Desmidt foresees a positive financial future in London: “To the extent that some people may be working for firms that are slightly ambiguous in terms of their commitment to London, we see that as an opportunity to stand fast and talk to more people,” he said.
“It is an interesting time for [Point72’s new financial team] to be looking at opportunities with a clean sheet of paper, without maybe a lot of the baggage that many members of the market are currently carrying,” agreed William R. Tovey, the new head of Point72’s London office. In fact, Tovey believes the London office could easily double in size—though the company’s focus, of course, is on quality rather than quantity.
The future of London post-Brexit remains uncertain. But the fact that some financiers are looking at the situation as an opportunity rather than the apocalypse suggests that it’s at least possible that London will ride the wave to better times—if not come out on top.