By Simon Jessop
LONDON (Reuters) – London-listed asset manager Polar Capital <POLR.L> will initially base five staff in Paris when Britain leaves the European Union, including its top risk officer, its chief executive said.
The number of staff affected by Brexit-related relocation has become a hot-button issue after Europe’s top regulator last year warned national regulators needed to ensure investment firms had enough senior staff on the ground to ensure businesses were doing more than setting up postal addresses.
Given the tough competition to win business, the degree to which the French national regulator, the Autorite des Marches Financiers (AMF), is enforcing that guidance is of particular interest to counterparts in rival centres.
Unlike rivals, Paris has yet to officially announce many major wins in asset management, despite aggressively courting leading firms. However, last month a source said BlackRock <BLK.N> had also chosen the city.
London-listed Polar, which manages nearly 14 billion pounds, said in June it would set up an office in the French capital to sell to EU clients when Britain leaves the bloc in March 2019, but gave few details.
While Dublin was considered as an alternative by Polar, the need to move senior staff to the chosen destination meant Paris had the edge, Chief Executive Gavin Rochussen told Reuters.
“Our chief risk officer is French and lives in Paris, and he (currently) commutes to London. So he provides the fund oversight function, and that’s considered to be what you’re required (to have) to prove substance.”
The company’s London-based assistant risk officer and two French-speaking sales people would also make the move, while a German-speaking salesman would also be employed through the Paris office, said Rochussen, who is South African.
Polar Capital employed 122 staff at the time of its full-year results in June, from 116 a year earlier.
“From the AMF’s point of view, they’ve now given us the approval; we’re fully regulated… they’re saying ‘it’s absolutely fine,” Rochussen said, adding the company now had around six months to get the office up and running.
As well as the cost of renting a serviced office, the company would face higher staffing costs, but probably save money on travel, leading to a net incremental annual cost of around 100,000-200,000 pounds a year, Rochussen said.
The company is looking to hire a team focused on continental European equities, which could also be based in Paris, Rochussen said, although it had yet to find one.
“Ideally, it would be nice if we could run it from the Paris office, but… I’m very ‘geo-agnostic’ when it comes to talent.”
($1 = 0.7730 pounds)
(Additional reporting by Inti Landauro in Paris; Editing by Keith Weir)