Sunday 16 December 2018

Thomson Reuters in Brexit forex trade move to Dublin

The $5trn-a-day global foreign exchange market relies on tech. Stock image
The $5trn-a-day global foreign exchange market relies on tech. Stock image

Tommy Wilkes and Guy Faulconbridge

Financial data and news and information provider Thomson Reuters is to transfer its $300bn-a-day foreign exchange derivatives trading platform to Dublin from London ahead of Britain's departure from the European Union next year.

Thomson Reuters runs one of the world's largest trading platforms in the $5trn-a-day global foreign exchange market.

The move is a blow to London, but will have little impact on its own in Ireland.

Separately, Bermuda-based Aspen Insurance announced that it is seeking authorisation to set up an Irish subsidiary to maintain access to the EU.

Thomson Reuters has applied to the Irish central bank to move its foreign exchange Multilateral Trading Facility (MTF) here so that it can continue to sell into the single market after Brexit, the company said.

Neill Penney, co-head of trading, said there were no plans to move staff from London but some new personnel would be hired in Dublin. "It doesn't matter for our customers which European city we are in. From a technology front, the technology is remaining where it is, which is in London and New York," he said.

He said Thomson Reuters had opted for Dublin over Amsterdam because it was the most cost-effective, would "minimise disruption for clients" and because Dublin's growing role as a centre for financial technology and research would "open a number of doors" should the company want to expand.

Even if only the legal entity moves, the departure of any part of a currencies trading business will be a blow to London. Foreign exchange trading remains the crown jewel of the City of London's financial services industry with volumes traded far surpassing any rival.

Major electronic bond and forex trading platforms have announced plans over the past year to shift their trading businesses out of London ahead of Brexit in March 2019, with most of Thomson Reuters' rivals opting for Amsterdam.

Big banks and trading platforms compete on speed when trading foreign exchange and invest heavily in cutting edge technology in London.

While trading platforms - or even some of the dealers themselves - go elsewhere after Brexit most of the hardware is likely to remain in London because of the high-speed sub-Atlantic cables linking it to New York.

Bloomberg, MarketAxess and Nex Group have chosen Amsterdam as their EU hub, media have reported. (Reuters)

Irish Independent

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