MADRID — Will the US financial overhaul push big firms to move business to Europe?
Now that the bill aimed at cracking down on the abuses that caused the 2008 financial crisis has been agreed on by House and Senate negotiators, analysts are scrambling to calculate whether the changes will create an incentive to move trading desks overseas.
One potential competitor — the 16-country “eurozone” — could be an unlikely destination for anyone wanting to shift operations, because governments there are already pledging to crack down on risk-taking bankers in the hopes of warding off more expensive bailouts
The new government in Britain is also moving to impose a new tax on the assets of the biggest banks, and the outgoing government imposed a one-off, 50 percent tax on outsized, unpopular bank bonuses.
So a more likely departure destination could be Asia.
“Singapore, Shanghai, Hong Kong, Tokyo and Zurich are the best bets,” said Richard Bove, senior vice president of equity research at Rochdale Securities in Stamford, Conn.
“It’s gonna cost them money, but they will find ways to move around the rules,” he said.