Brexit: Central Bank reports ‘major increase’ in talks with UK firms

There has been a "major increase" in the number of UK firms communicating with the Central Bank about the possibility of relocating to Dublin after Britain leaves the European Union, the regulator has said.

However, Ed Sibley, the bank’s director of credit institutions, told the Oireachtas finance committee on Tuesday that while the regulator was engaged with “scores” of firms, the number was not necessarily indicative of how many would ultimately move.

“Since the Brexit referendum the Central Bank has had significant engagement with firms who are exploring the possibility of relocating aspects of their operations to Ireland,” he said.

“This includes existing firms that are considering changes to existing operations, and those that are considering seeking entirely new authorisations. This represents a major increase against normal activity and has been observed across all sectors.

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“Firms that are considering moving activities from the UK are typically visiting several jurisdictions to assess the fit of that jurisdiction for their businesses. They are then whittling these locations down to two or three possibilities.

Formal application

“In the case of Ireland, and similarly across the EU, they will then embark on the formal process. Even at this latter stage a submission of a formal application may be several months away. Different firms are at different stages of this process.

“So, in the same way as scores of meetings are being held in Dublin, they are also being held in Paris, Frankfurt, Amsterdam, and so on. The number of meetings held to date gives absolutely no indication as to the likely outcome.”

Mr Sibley also said the number of applications or expressions of interest do not give any sense as to the size, scale or complexity of an operation.

“What I would say is that, based on the many meetings we have had to date, Ireland can expect to receive a meaningful share of the activities that will move from the UK.”

Mr Sibley stressed that the Central Bank had “absolutely no tolerance” for companies that were not substantively run from the Republic. “We’re making sure there is substance to any firms that relocate to Ireland.

Financial crisis

“The lessons from the global financial crisis remain fresh in the minds of the European regulatory community and form the foundation for assessing the implications of the new organisational configurations that Brexit will trigger.”

Earlier, Financial Services Ireland, which is a trade association within Ibec, said tens of thousands of jobs could be formed in the Republic after Brexit. Marc Coleman, its director, said it was a "once in a lifetime opportunity".

“We’re talking about 10,000 to 20,000 jobs. That could significantly offset job losses in other areas.”

Mr Coleman also called for a “constructive assessment” as to why some firms have chosen different jurisdictions post-Brexit.