Brexit Britain has scored a huge win with Vanguard, the world’s second largest fund manager, reportedly snubbing the European Union with plans to open its second UK office – a move that will create 100 jobs. The US fund manager, which manages £6trillion globally, will announce plans to open a new base in Manchester, according to a report from The Daily Telegraph, citing City sources. Vanguard will reportedly lease 14,000 square feet in the Landmark development in St Peter’s Square in the centre of the UK’s second-biggest city by population.
It is expected the opening of the office will create around 100 jobs, raising the company’s footprint in the UK to 900 people.
The fund manager employs around 20,ooo people globally but on the Continent, it has a tiny fraction of that with just 200 staff.
It is a major blow to EU countries, who over the past few years, have been trying to take advantage of Brexit by encouraging multinational financial companies to grow their business on the Continent.
In addition, the Covid pandemic from 2020 has since seen large financial institutions reducing their office space as workers adopt remote working practices.
Vanguard is one of many companies that now employs a hybrid working model for swathes of its workforce, with staff working from home on Monday and Friday, while coming into the office on the remaining three weekdays.
A recent report from accountancy PwC predicted UK employers would cut their office size by nine million square feet over the coming years.
One third of the businesses surveyed in the report said they expect their office footprint to reduce by more than 30 percent.
Last week, Andrew Griffith, Economic Secretary to the Treasury said the UK is pushing to work with Brussels on financial services regulation after a deal on post-Brexit trade with Northern Ireland was reached between the two sides.
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He said this would open the door to the signing of the Memorandum of Understanding agreed with the EU in principle in 2021.
Mr Griffith told the POLITICO Finance Summit in Paris on Thursday: “That will give us the framework to have the very closest dialogue with the partners who represent a very significant part of our UK financial markets.”
Some European Governments had feared the UK might use Brexit as an excuse to dilute its regulatory framework in an effort to win more business and lead the way to a second “big bang” to charge the economy.
But Mr Griffith has told the EU this is “not the case”, and said: “That’s one of the things I want to impress upon participants today. Our ambition, our commitment to the highest quality standards of regulation is wholly undiminshed.”
“There may be particular cases led by the facts where we do things slightly different but with the same outcome and with the same commitment to high quality standards in mind.”