Daiwa Securities, a Japanese brokerage with operations in the U.K., would have to set up a business in the European Union that replicates or replaces some functions in London if Britain votes to leave the bloc, according to a memo to employees.
“Brexit would have the potential to have a profound impact” on Daiwa Capital Markets Europe Ltd. and its London operations, the unit wrote in the document seen by Bloomberg. Hiroki Aoyama, a spokesman for the parent company in Tokyo, declined to comment.
Bloomberg News reports that financial firms including JPMorgan, HSBC and Deutsche Bank are warning of the need to move activities from London if British people choose to leave the EU in the June 23 referendum. Citigroup will “rebalance” its European operations in the event of a so-called Brexit, a company memo showed this week.
Under European banking law, financial firms not based in the EU need an authorized presence to do business there. If the U.K. left the union, Daiwa Capital Markets Europe would lose the right to operate freely in the region because its branch in Geneva is outside the EU, it said in the memo.
To access the complete Bloomberg News article hit the link below: