Who will become the new European financial center after Britain leaves the EU?

The process of Britain's leaving the EU has started, and the list of joining the new European financial center is getting longer and longer.

Just 48 hours before Britain officially announced the terms that triggered Britain's withdrawal from the EU, Milan also announced its participation in the competition of the new European financial center.

In the latest global financial center index (GFCI) ranking. Milan is only ranked 56th. However, this does not prevent Milan's financial decision makers from trying to get a piece of the British exit from the EU negotiations. Some analysts predict that Britain's withdrawal from the EU may cause the City of London to lose as many as 230,000 jobs and transfer assets totaling10.8 trillion euros.

There is a growing dispute between Paris and Frankfurt: the French are complaining about the boring life in Frankfurt, while the Germans are poking fun at the strike tradition in Paris.

Although France sent a "lobbying group" to the world, its lobbying ability was obviously better, but Frankfurt still prevailed. At the same time, the biggest obstacle to prevent financial institutions from entering Paris is Le Pen, the presidential candidate of the French far-right National Front.

At the same time, there is a view in European political circles that there is no need to transfer all the businesses and jobs lost in the City of London due to Britain's withdrawal from the EU to a specific country. If the benefits can be shared equally, it will give countries more motivation to unite and deal with Britain in the negotiations of Britain's withdrawal from the EU.

After Britain announced the result of the referendum on Britain's withdrawal from the European Union, many large financial institutions have begun to weigh their future choices. Once Britain leaves the European single market, many financial institutions headquartered in London will lose their "financial passports" in the other 27 EU member States, and all institutions are quietly preparing for the worst.

The risk of job migration brought by Britain's withdrawal from the EU. Gray: the total number of relevant personnel; Blue: people who may migrate. From top to bottom: JP Morgan; Barclays; Morgan Stanley; Goldman Sachs; Ubs; HSBC Bank. Deutsche Bank; Citigroup; Credit Suisse Group

The latest GFCI shows that London is still the number one financial center in the world, but it will leave the EU or change its ranking. At the same time, Frankfurt ranked 19, Paris ranked 29th and Dublin ranked 3 1. Among them, Frankfurt is regarded as the number one competitor of Paris.

Ranking of financial centers, from top to bottom: Dublin; Oslo; Luxembourg; Munich; Frankfurt; Paris; Vienna; London

Hubertus Vth, President of Frankfurt Financial Cooperation Promotion Association, aims to attract 65,438+00,000 financial jobs to Frankfurt in the next five years. Shout out the slogan "Frankfurt has hung the welcome flag and the door is open to you" and tell the financial industry in London, "Don't waste any good crisis."

The advantages of Frankfurt are obvious. Eight of the largest 10 banks in the City of London have branches in Frankfurt; Among the 10 largest insurance institutions, 6 have branches in Frankfurt or Munich, and the English level of German financial practitioners is impeccable, which will make the job transfer process much easier. In terms of cost, Frankfurt is much lower than Paris.

In fact, as far as housing is concerned, Frankfurt is the cheapest financial center in Europe: in Frankfurt, the total cost of renting apartments and the cost of office space per employee is about 30,000 euros, less than half that of Paris.

While promoting the French strike tradition, Germany is still poking fun at it. Thomas Schfer, finance minister of Hesse, where Frankfurt is located, said, Look at the frequency of strikes in France. "If you haven't cleaned the trash can in Frankfurt for three days, it must be the end of the world. If it is in France, this is estimated to mean the beginning of economic improvement. "

According to a recent Financial Times survey of 30 senior financial practitioners and officials, Frankfurt is in an absolute leading position in this competition. One of the important reasons is that Frankfurt is the seat of the European Central Bank.

An executive who intends to move his job to Europe said that Germany is so leading that the French can't believe this reality.

Andreas Dombret, a senior director of the Bundesbank, said on the day Britain left the EU: "Many banks are interested in Frankfurt and have already knocked on our door. We also had many interesting discussions. "

According to comprehensive reports, UBS, Morgan Stanley, JPMorgan Chase and Merrill Lynch are all considering Frankfurt.

"Three of the top five banks in the United States, as well as a bank in Switzerland, Japan, South Korea and India, said that they have either decided to come to Frankfurt or are making a decision." Fatt said.

However, Frankfurt is not without its shortcomings. Compared with Paris and London, Frankfurt seems a bit dull. Fatt also admitted: "The media described Frankfurt as something between a cemetery and stagnant water."

Compared with Paris, life in Frankfurt seems a little lacking in entertainment. This is often complained by relevant practitioners working in Frankfurt. A former executive of the German edition of the Financial Times complained to the First Financial Reporter that because life in Frankfurt is so boring, even though the news of the European Central Bank is very important, his reporters are reluctant to stay in Frankfurt.

In response, Frankfurt even brought a nightclub owner to the lobbying team sent to London to "wash" Frankfurt's reputation.

France has sent almost the most ambitious lobbying team to introduce itself around the world.

Christian Nouaille, honorary president of the Bank of France, became a special envoy to help France compete for the European financial center after he stepped down as governor of the Bank of France. At the end of last year, he paid a low-key visit to financial institutions and regulatory authorities in China and introduced the Paris Financial Center. He obviously wants to get rid of stereotypes in France, such as high tax rate, inflexible labor market and French hatred of English.

In an exclusive interview with China Business News, Nouaille said that the current benchmark corporate income tax rate in France is 33.3%, but it will be reduced to 28% by 2020.

Last month, HSBC said it planned to relocate 65,438+0,000 employees to Paris, half of whom were French.

Nouaille said that France is making efforts to reform the labor market, and its regulatory agencies are well qualified. At present, Paris has gathered five of the top 20 banks in Europe and three of the top 25 insurance companies in the world. At the same time, Paris is the largest asset management center in continental Europe, with an asset management scale of 3.6 trillion euros, second only to London. In addition, it has gathered four major asset management companies in the world.

However, according to the Financial Times survey, the reason why financial institutions have reservations about Paris is that they are worried that Le Pen will win the general election in May. A senior official in the French lobbying team said that many financial institutions are waiting for the results of the French presidential election in May, and they will immediately start to consider moving to Paris, regardless of whether the French right and political party candidate Fillon or the independent candidate Macron (a former Rothschild banker) wins the election. "But if they are still left or right, then this will be a serious problem, and they are likely to go elsewhere."

Le Pen currently promises that if he comes to power, it may trigger a referendum on "France's Britain leaving the EU" and has repeatedly threatened to leave the euro zone.

Faced with the possibility that the extreme right wing may come to power in the French general election and change the pattern of France and even the European Union, Nouaille smiled helplessly, but firmly replied: "It is absolutely impossible for France to leave the European Union."

"Without France, there would be no EU, just as without Germany, there would be no EU," he said. "I can guarantee that no matter what the outcome of our election, we will not leave the EU."

As more European cities join the battle for the new European financial center, the final win-win outcome is likely to be to distribute the business transferred from London among many financial cities.

"I don't think all banks will move to the same city in Europe. They will definitely spread out a little. " Dong Brett said that banks operating in the EU need to obtain the regulatory permission of "EU passport" and must set up regional headquarters in at least one EU member state.

Schaefer said that the dispersion of these financial services in Europe may have a positive impact on the EU negotiations.

"If all the jobs go to a country, those countries that don't benefit will not regard this as an important part of Britain's withdrawal from the EU and negotiations with Britain." Schaefer said, "However, if most of us can make a profit, at this point, we can better unite the front and ensure that we get better results from the British side."

Financial practitioners also tend to think that European cities that join the war have their own advantages and disadvantages, and they can make two-way choices according to the needs of various institutions.

For example, Dublin's greatest advantage is that its legal system is similar to that of Britain, and its time zone and language are the same as those of London, but its disadvantages are also obvious: infrastructure and regulatory capacity are still lacking. At present, some financial institutions including Citibank will transfer more transactions from London to Dublin.

Luxembourg is a country with a tradition of favoring the financial industry and bankers. However, the disadvantage of the country is that its economy is too small, which may lead to overload problems.

Amsterdam has a good land, sea and air transportation hub in Europe, and English is widely used in the Netherlands. However, its financial industry is still very small at present, and there is a strict upper limit for salary rewards. However, some Japanese bankers have taken a fancy to Amsterdam's good airport capacity.

Warsaw has the most cost-effective, well-educated and reasonably paid senior staff in Europe. However, investment banks are unlikely to put front-office work there. Many big banks have outsourced back-office and IT services to Warsaw, and Poland expects to create 35,000 business service jobs this year.

In addition, Berlin and Stockholm are trying to challenge London's position as a financial technology center. Many financial technology companies are worried that industries that rely on high-tech talents may not be able to hire top talents from all over the world in London due to the tightening of immigration policy after Britain leaves the European Union.

Speaking of Milan, although its competitiveness as a financial center is unknown, its conditions are simple and clear: substantial tax cuts.