BNP Chairman Sees Big Changes to City of London After Brexit

(Bloomberg) -- BNP Paribas SA’s chairman said London’s financial district will undergo large changes following the U.K.’s decision to leave the European Union as banks operating there prepare to secure access to the bloc.

“I don’t see London remaining as it is; there will be change and it will be significant,” Jean-Adrien Lemierre said in a speech at the Paris Europlace financial forum in Tokyo on Monday. “Banks are already making quiet moves in preparation.”

European financial centers are making competing pitches for any financial jobs that flow out of London in the aftermath of the Brexit vote in June. Lemierre touted Paris as a potential destination, saying the French capital has a strong financial center with a balanced regulatory framework and a large talent pool.

Trade negotiations between the U.K. and the EU over the terms of Brexit will be long and difficult, according to Lemierre. He said the British government has shown it’s unwilling to agree on freedom of movement within the union, as well as the jurisdiction of the European Court of Justice. Authorities will need to resolve the two biggest issues facing banks, which are passporting rights and the infrastructure for clearing transactions, Lemierre said.

Read more on the future of London’s financial district

At the same time, Lemierre said the EU is withstanding any fallout over Brexit.

“Europe is doing well -- demand is strong and we are seeing investment rebound,” he said. “Brexit has had no impact on the EU so far.”

Lemierre said it was too soon to comment on Italy’s vote to reject changes to the constitution. Prime Minister Matteo Renzi resigned in the early hours of Monday after accepting defeat in the referendum.

To contact the reporters on this story: Gareth Allan in Tokyo at gallan11@bloomberg.net, Shingo Kawamoto in Tokyo at skawamoto2@bloomberg.net. To contact the editors responsible for this story: Marcus Wright at mwright115@bloomberg.net, Russell Ward, Darren Boey