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Goldman to open trading venue in Paris due to Brexit

Lucy Burton
·2 min read
Paris
Paris

Goldman Sachs is to open a trading venue in Paris as a result of Brexit as big banks ramp up their plans to protect clients in the event of a no-deal exit from the EU. 

The Wall Street bank, which this month moved up to $60bn (£46bn) worth of assets out of the UK and into Germany due to Brexit, said it plans to open a trading venue in Paris called Sigma X Europe by January 4. 

The UK is in a transition period until the end of the year, after which the City will be stripped of its EU passporting rights, which currently provide full access to EU markets

Goldman's Paris trading hub is designed to ensure clients on the continent can still buy and sell shares regardless of the negotiations.

The US bank has previously warned that a “difficult” Brexit would negatively affect its investment plans in the UK. 

Brexit | What's the difference between equivalence and mutual recognition?
Brexit | What's the difference between equivalence and mutual recognition?

UK-EU trade talks remain deadlocked, and failure to agree replacement trading arrangements will mean the UK leaving without a deal on January 1

Elizabeth Martin, Goldman's co-head of electronic trading, told Bloomberg that she believes London will lose most of its trading volumes in EU stocks post-Brexit. Around a third of all European share trading, around $10bn a day, takes place in London. 

The financial services sector has been a key battleground ever since the Brexit vote, with rival EU cities such as Paris and Frankfurt ramping up efforts to attract bankers from the City amid the back and forth. 

Goldman's closest rival JP Morgan is planning to shift around $230bn worth of assets from the UK to Frankfurt before the end of this year, according to reports. And last year Barclays triggered plans to shift £166bn into its Irish subsidiary, meaning the transferred business will be conducted by the bank's Irish division after December 31.