By Richard Smith, a UK-based international bullshit arbitrageur
Standard Chartered might go to Hong Kong:
Standard Chartered considering its domicile options 17th September 2010
HSBC is all of a tizzy:
Barclays, meanwhile, feels the call of New York:
Will Barclays Turn Its Back on Britain? 30th March
..though they may have a disappointment coming, because…
In JPMorgan’s Dimon Warns of Regulatory ‘Nail’ in Coffin, 31st March 2011, Dimon informs us that actually, the US may be overregulated, too:
Regulators are negotiating international capital standards for the biggest banks but the chief executive of JP Morgan said setting the new requirements too high, or allowing overseas banks to calculate their asset base differently, could disadvantage US banks and was already stifling economic growth…Too large a disparity in capital requirements between Europe and the US would mean “you’re pretty much putting the nail in our coffin for big American banks,” he said.
And their clients will go overseas as as well:
Attacking another aspect of Dodd-Frank, Mr. Dimon said rules requiring companies to put up collateral as they trade derivatives would “damage America”. Gesturing at the chief executive of Caterpillar, Mr. Dimon predicted the industrial company would take its derivatives business to Singapore.
Meanwhile Greenspan, in Dodd-Frank fails to meet test of our times, 29th March 2011, thinks it’s even worse than that:
…concerns are growing that without immediate exemption from Dodd-Frank, a significant proportion of the foreign exchange derivatives market would leave the US.
To the bogeymen of Hong Kong, Singapore, Paris, Europe, Asia, not-the-US and not-London we can now add Canada:
…Many of the act’s rules on proprietary trading, for example, apply to US banks globally. But competing US offices of foreign institutions can readily switch proprietary transactions to European and Asian banks, and if time zones are relevant, to Canadian banks.
Poor old Barclays: perhaps there will be no one left to trade with in New York, by the time they get there.
For my part, I think all the banks should consider moving to Dublin. The Irish economy could do with a bit of help right now. The reasons for that might remind bankers why taxpayers are so lukewarm about hosting them.