Brexit frustrations for Central Bank as UK firms seek to relocate
Regulators highlight issues with those seeking to relocate financial activity from London
The Central Bank is dealing with more than 180 active Brexit-related applications from firms looking to move operations to Dublin, Pinsent Masons estimated. Photograph: Alan Betson
The Central Bank, chastened by Ireland’s banking crisis, has been the subject of some criticism by financial and political types in the past year for a perceived reluctance to see a raft of financial activity move from Dublin from London.
But it appears that regulators have their own frustrations, too.
Michael Hodson, director of asset-management supervision at the Central Bank, told a gathering of advisers and lawyers earlier this month that he had been surprised and disappointed by how some fund managers seeking authorisation in Dublin thought they could get away with setting up units with minimal substance, according to law firm Pinsent Masons.
Hodson also seems to have been “particularly frustrated and surprised” to find overseas group that had pressed for support on applications only to hold off when they were given the green light to make a formal submission, Pinsent Masons lawyers Marilyn Cooney and Gayle Bowen said in a briefing note for clients on Monday.
Other senior Central Bank figures also told the audience that firms seeking authorisation in Ireland will find it very difficult to get an application over the line by the time Brexit takes effect next March unless they begin the process by the end of this month.
So far, Brexit-related activities moving to Dublin have been something of a mixed bag. While the likes of Barclays and JPMorgan are expected to move hundreds of roles to Dublin, Frankfurt appears to be the main winner on the banking front.
And although insurers including Beazley, Hiscox and XL Group have outlined plans to establish European Union hubs in Ireland to retain access to the single market, the resulting jobs will be in the tens for each.
While Pinsent Masons, who themselves established a base in Dublin because of the UK’s decision to exit the EU, estimates the Central Bank is currently dealing with more than 180 active Brexit-related applications, and that the number is expected to increase “significantly” in the near future, there are very few indications that firms are moving front-office roles to Dublin en masse.