Morgan Stanley to move €100bn assets from UK to Germany over Brexit

Morgan Stanley is planning to move around €100bn (£91bn, $120bn) in assets out of the UK because of Brexit disruption.

Yahoo Finance UK understands the bank is preparing to transfer assets to its subsidiary Morgan Stanley SE, which is based in Germany’s financial hub Frankfurt.

Most of the planned transfer is reported by Bloomberg to be planned for the first three months of 2021.

The move is likely to overcome difficulties caused by the expiry of the UK’s Brexit transition period at the end of the year.

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The UK government’s Brexit plans mean the country will leave the EU customs union and single market. UK financial firms will lose so-called “passporting” rights to sell their services freely within other EU member states.

Such rights to trade as though they were trading domestically have helped the City of London thrive as a major European hub, and there are widespread fears its status and success is under threat from the significant new obstacles to EU trade.

Morgan Stanley is the latest in a string of financial firms to move assets and staff to EU-based arms, allowing the services to continue to operate fully within the bloc.

Professional services firm EY predicted last year that as much as $1tn (£750bn) in assets could be moved out of the UK ahead of Brexit disruption.

READ MORE: Pound slides after Brussels summit fails to break Brexit deadlock

UK expats living in the EU are also affected by Brexit disruption to finance. Major UK banks wrote to customers earlier this year, warning they would no longer be able to service them because of the lack of a “passporting” agreement.

A Morgan Stanley spokesperson declined to comment.

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