Credit Suisse has announced that it will be vacating its offices in London’s Canary Wharf financial district. The move comes as the Swiss headquartered firm maintains its cost-cutting agenda. As it currently stands, the terms of the lease have confined the company to the offices through 2024.
The likely scenario will see Credit Suisse attempt to terminate the lease at an earlier date, or alternatively sub-lease the offices to another company. The move is estimated to take place sometime within the next two years.
Credit Suisse has been on a cost cutting path over the past six months. In June of 2017, the company announced an additional round of job cuts. The plan specified letting go of 1,500 employees, which would drop the total number to 5,000 in the London offices, compared to 9,000 back in 2015.
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The major job cuts are associated with ramifications stemming from the Brexit vote and its corresponding uncertainty. Credit Suisse is taking action to improve its profitability. In addition to cutting costs, the lender has been refocusing its efforts in wealth management and emerging markets, in the hopes of producing higher returns.
The Brexit Effect
The effects of Brexit are still being felt, as many banks have pondered leaving their UK headquarters for European alternatives. As the country prepares to make a soft exit out of the EU, there are major political and financial implications to be considered. One lender that has openly addressed their concerns is Barclay’s, which has already mentioned potentially moving hundreds of staff out of its UK office.
Due to mounting pressure applied by the BoE, the bank is sorting out the details and is eyeing Dublin as a possible new location. Similarly, other banks and financial institutions searching for their own respective solutions. JP Morgan has scoped potential substitutes to London, as it began to focus on Paris as the likeliest destination.