Brexit to Be Blamed For a Decision Of Moving to Amsterdam: Leading Japanese Bank
One of Japan’s leading banks has stated that the Brexit deal is to be blamed for making a decision involving moving part of its business to the region of Amsterdam. This happened shortly after UK’s Prime Minister Theresa May sought to include Japan’s Prime Minister in her struggle against saving her deal with the EU.
The bank, Norinchukin, has recently announced their plan that they intend to set up a subsidiary in the Dutch capital which would act as a wholly-owned subsidiary by the parent company. The critics of Theresa May have opined that this deal would most likely damage the economy of the UK.
On the morning of Friday, 11th January, the bank made a statement that their plan to withdraw stems from the UK’s decision to exit from the European Union, especially as many economic changes are expected in the region of Europe after the UK officially exits the EU.
The bank’s spokesperson further added that this decision of moving a part of their business to Amsterdam has been reached to strengthen its core operations, particularly in the region of Europe. However, the move will also most likely reduce the bank’s influence in the UK.
A Brief History of the Bank
Norinchukin Bank came into existence in the year 1923, and now it is one of the leading banks in the world. According to data, Nurinchukin Bank stands at 40th position among the largest banks in the world. The total balance sheet footing of the Nurinchukin Bank stands at 804 billion Euros. It has almost 500 billion Euros of investments with different clients from Japan. The bank’s business in the region of the UK was mainly dealing in asset management, which included different investment options such as securities, bonds, real estate, and equity investment.
Good News For Amsterdam
This decision of moving a part of their business to Amsterdam will likely provide a great boost to the economy of Amsterdam, at least according to a report published in one Dutch newspaper. One of the leading investment agencies located in Netherlands has stated that this decision is very beneficial for the country’s economy, as Norinchukin Bank will now continue its operations from the Netherlands and will maintain its focus on the financial markets of Europe.
However, continuing the bank’s operations from Netherlands highlights the country’s importance and confirms its status as an emerging business center for the entire European region.
The Impact of the Withdrawal
The withdrawal deal is likely to cause many firms in the UK to restrict their operations in the European region because the Brexit deal will cause them to lose out on their pass-porting rights, which otherwise allow them to travel freely in and out of Europe. The bank’s future business relationships will also take a hit from this decision.
Previously, the bank’s Chairman of the Board Kazuto Oku discussed his intention to diversify the operations of the bank across the region of Europe. He further added that, since the UK is reaching a deal of withdrawal with the European Union, this will cause the bank to lose out on some part of its business operating in the region of London.
However, the decision to shift operations has been taken solely with the purpose of making the bank’s business stronger in the European region.
The UK has always been considered a business hub by many Japanese companies who have wanted to expand their operations across Europe. However, the Japanese ambassador to the UK, Koji Tsuruoka, believes that the UK’s withdrawal from the European Union will affect the economy of UK because many firms, who have their headquarters located in the UK and can move freely throughout Europe, will no longer be able to move so freely because of restrictions that would be imposed on trade.
Previously, another leading bank, also from Japan, called MUFG, had also filed for a license to work in the region of Amsterdam back in the year of 2017, following the lead of many other businesses that are also aiming to serve the European market but are afraid of the possible restrictions in the coming months. Not to forget the fact that the MUFG has already shifted their European Union headquarters to the Dutch capital.
The Brexit deal is most likely to cause many firms to shift some part of their business to other regions of Europe in order to serve the customer needs across Europe. The exiting deal would include a transition period of 21 months which could be extended to a further period of 2 years. During this period, the UK businesses will continue to operate in the stand-alone market and will not interfere in institutions setup across Europe.
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