BlackRock threatens London cuts if UK leaves the EU

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A senior executive at the world’s biggest asset manager BlackRock has said the fund manager might move operations out of London if Britain leaves the European Union.

Speaking last week at a debate on Brexit – a British exit from the EU – Joanna Cound, BlackRock’s head of government affairs and public policy in Europe, said: ‘Our largest single office is in London and we have 14 offices throughout Europe.

‘More than half of our revenues come from clients around the rest of the EU. I am not sure that the balance would remain as it is if the UK left the EU.’

The comments, made at the British Bankers’ Association’s annual conference, are the first time a major fund manager has publicly said what might happen in the event of a Brexit.

Rules require funds to be based within the EU in order to sell to customers in the union. Many fund managers are likely to shift funds and staff if the UK quits the EU.

It is thought that some have established committees to look at the implications, but none have gone on the record.

BlackRock, which has its headquarters in the US, employs 2,000 staff at an office in the Square Mile, which was officially opened four years ago by Chancellor George Osborne.

The asset manager, which has more than $4.5 trillion (£3 trillion) of assets under management, employs the Chancellor’s former chief of staff Rupert Harrison as an economic analyst.

Asked to expand on the comments, BlackRock issued a statement saying: ‘To draw any conclusions from Ms Cound’s remarks would be inaccurate and misleading. We’re not going to be drawn in to commenting on speculation.’

While keeping tight-lipped on its own plans in the event of a British exit from the EU, the asset manager has previously suggested that the move could present a number of risks for our economy.

In an update to clients in April, BlackRock warned that such a move might mean Government bonds lose their ‘safe-haven’ status.

It said it could also lead to a dampening of business and foreign investment, as well as introducing a harsh spotlight on Britain’s chronic current account deficit.