Lloyd’s of London says it will establish a new European subsidiary in Brussels to avoid losing business when the UK leaves the EU.
The 329-year-old insurance market confirmed the plan as it released its latest annual results.
“A subsidiary office will be opened in Brussels with the intention that it will be operational for the January 1 renewal season in 2019,” it said.
The company’s continental business generates 11% of its premiums.
Lloyd’s of London’s chief executive Inga Beale told the BBC’s Today programme Brussels had certain key attractions: “What we were after was some jurisdiction that had a really robust reputation for regulation, we also wanted to be able to access talent and we wanted really good accessibility.
“Brussels came out top of our list.”
However, she stressed that the Brussels office was an additional base, simply an EU subsidiary, and that the number of jobs affected was less than 100.
The company has around 700 London employees, but the market it runs involves more than 30,000.
Other financial institutions have also said they are thinking of moving some business within Europe.
Several investment banks, including Bank of America, Barclays, and Morgan Stanley are considering relocating staff to Dublin. Frankfurt, Madrid and Amsterdam are also likely to benefit. HSBC is expected to move significant numbers of employees to Paris.
Lloyd’s of London also announced it had made a profit of £2.1bn in 2016, the same as for the year before.
It said conditions over the course of the year had been “extremely challenging”. There were £2.1bn of major claims – the fifth highest since the turn of the century – which was due mainly to Hurricane Matthew and the Fort McMurray Wildfire in Canada.
However, the company added that its results had been helped by “significantly improved” investment returns.
Lloyd’s, one of Britain’s oldest institutions, is the world’s leading insurance and reinsurance market.
It focuses on specialist markets, such as marine, energy and political risk, but also branches out into more unusual areas, such as insuring comedian Ken Dodd’s teeth.
Many financial institutions are eyeing alternative locations around Europe, to ensure they can keep doing business in the EU when Britain leaves. Which will they choose?
Frankfurt has hit the ground running when it comes to wooing Brexit-bothered London bankers. It has a well-established financial infrastructure, is home to the European Central Bank and many banks already have a presence there And while German is the native tongue, most locals and the business community boast polished English language skills. Dublin
The Irish capital offers an attractive alternative English-speaking location. But with a population of only 1.8m it may struggle to provide the infrastructure required for a full-scale alternative to London. Several banks are contemplating having some kind of presence there.
As they say there (with a gallic shrug): “Where would you want to take your partner for a weekend away?” Nowhere else quite matches the French capital for romance and flair. It’s a big city, plus it’s geographically central. There is however the wild card of what will happen in the upcoming presidential elections.
Like Paris, Brussels is close to London, which, given that the UK is likely to keep a significant amount of financial business even after Brexit, is a big plus. And it wins hands down if you want proximity to the regulators and decision-makers of the European Union. But as the home of the Eurocrat the consensus seems to be that it lacks allure as a place to live.
Luxembourg already knows how to cater to the global banking community with hundreds of financial institutions already using it as a base. But it could also have capacity issues. It’s the smallest of the destinations under consideration – with a population of only 500,000 – and arguably the most staid. If you want your staff to focus on work and not be distracted by the nightlife this could be the right option.
Join GhanaStar.com to receive daily email alerts of breaking news in Ghana. GhanaStar.com is your source for all Ghana News. Get the latest Ghana news, breaking news, sports, politics, entertainment and more about Ghana, Africa and beyond.