Brussels expects to lure other financial players after convincing Lloyd’s of London, the world’s largest specialty insurance market, to make the city its post-Brexit European hub.
While Lloyd’s choice on Thursday surprised some, lower rental prices and its proximity to Britain could help other financial firms choose the multilingual home of the European Union over Dublin, Frankfurt, Paris and Luxembourg.
Lloyd’s is expected to move fewer than 100 people, but other insurers needing an EU subsidiary to keep access to the single market after Britain leaves the bloc may follow. Lloyd’s has long been a magnet for insurance underwriters, most of which are clustered around its landmark building in the City of London.
“From our contacts with consultancy firms we have learned that several companies are interested in Belgium,” a spokeswoman for Belgium’s financial sector federation Febelfin said, without specifying which companies or sectors had expressed an interest.
Brussels suffered as a banking center during the financial crisis in which its three largest banks required state-led bailouts from which only one has really recovered and employment in Belgium’s financial sector has been in steady decline, shrinking some 20 percent since 2007.
Fortis, once one of Europe’s largest banks, now only exists as a pared-down insurer, Ageas, after its banking operations were sold to France’s BNP Paribas.
Dexia, once the world’s largest lender to municipalities, is being wound down, with Belgium, France and Luxembourg guaranteeing 71 billion euros ($77 billion) of the group’s borrowings.
Nevertheless, Belgium still hosts the headquarters of payment messaging provider Swift and clearing house Euroclear and some 82 banks have an office in the country.
Being in the vicinity of European institutions also allows for easy access to high-level decision makers.
For employees cosmopolitan Brussels offers rents which are about a third of those in London, high-speed rail services reaching the UK capital in less than two hours and good food.
“What people really like here is the international community that definitely is the number one reason to come here,” Edgar Hutte of the Brussels Expat Club, which helps new arrivals settle in, said.
The negatives include hefty income taxes, among the highest in the OECD group of developed countries, bureaucratic red tape and world record traffic jams.
($1 = 0.9264 euros)
(Editing by Philip Blenkinsop and Alexander Smith)
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