T. Rowe splits European business ahead of Brexit
Luxembourg to become head office for EU business
T. Rowe Price has begun the process of splitting its UK and Luxembourg operations with the latter set to become the head office for the firm's European business in time for the UK leaving the EU.
The move comes as investment firms action their Brexit contingency plans with a lack of clarity surrounding the UK fund management industry's Brexit transition putting the UK in a weak spot.
Earlier this month the European Commission warned UK-based fund groups could have their permissions to sell products into the EU revoked from April next year.
Two weeks ago T. Rowe Price applied to Luxembourg's financial regulator, the Commission De Surveillance Du Secteur Financier, to separate its UK and Luxembourg operations, the Financial Times reports. Although the UK arm will continue to operate in the domestic market the Luxembourg company will become the new head office for its EU business.
"We took a decision last year that we needed to get started on this now if we were going to be ready in time," said Robert Higginbotham, head of global investment services at T. Rowe Price.
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"All this is based on what we know about Brexit at the moment — which will probably be about 25% of what we know in a year's time. We have been working on this for a year and will have to get it complete by the end of the year."
Higginbotham added the new Luxembourg entity should be set up by the summer and that all other EU offices would be reporting to it by the end of the year. The move will not affect UK jobs.
T. Rowe Price has European operations in Madrid, Milan, Zurich, Frankfurt, Amsterdam, Copenhagen and Stockholm. The move will not affect UK jobs.
In the past year T. Rowe Price has expanded its UK intermediary team, with Stephen McShane and Lee Ryan joining from Neptune and Edward Tennant moving over from Lombard Odier.
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