Lloyd’s of London said on Thursday it was aiming to open a new European subsidiary in Brussels from January 2019, which marks the deadline set by the UK government to officially leave the EU. However, only a small portion of jobs will be moved to the Belgian capital.
It had previously warned it would relocate if the UK failed to secure passporting rights during its EU exit negotiations.
The chairman John Nelson explained at the time securing access to the single market was important for the group, as 11% (£2.9bn) of its transactions came from the EU in 2015.
Before the referendum, Lloyd's said at least 34,000 jobs could be at risk in the insurance industry if the UK voted to leave the EU.
Inga Beale, Lloyd’s chief executive said, “It is important that we are able to provide the market and customers with an effective solution that means business can carry on without interruption when the UK leaves the EU.
“Brussels met the critical elements of providing a robust regulatory framework in a central European location, and will enable Lloyd’s to continue to provide specialist underwriting expertise to our customers.”
“I am excited about the opportunities this venture will offer the market by providing that important European access efficiently.”
Speaking on the BBC's Today programme, Beale explained Brussels was the chosen destination because of the likelihood of Belgium staying within the EU in the future.
She added, “What we were after was some jurisdiction that had a really robust reputation for regulation, we also wanted to be able to access talent and we wanted really good accessibility.”
The chief executive said that, while the London office employs around 700 people, only around 100 will be moving to the Belgian capital.
Meanwhile, Lloyd’s urged the government and the EU to proceed to negotiate an agreement that allows business to continue to flow under the best possible conditions once the UK formally leaves the EU.
“I believe it is important not just for the City but also for Europe that we reach a mutually beneficial agreement. We stand ready to help and support the government as best we can,” Beale said.
In October last year, the chief executive of the British Bankers Association said Britain's biggest banks were preparing to relocate out of the UK.
Anthony Browne said at the time that the banking industry would be “probably more affected by Brexit than any other sector of the economy”, putting £20bn worth of trade in financial services at risk.