LONDON/MILAN: Italian financiers who handle some of their country’s biggest deals out of London are moving to Milan, lured by bumper tax breaks at a time of deep uncertainty about Brexit, sources familiar with the plans said.
Investment bankers making the switch include Goldman Sachs’ co-head of Italy Francesco Pascuzzi, who also co-heads the global power and infrastructure team, and is looking to move early next year, the sources told Reuters.
Goldman and JPMorgan have started looking for new offices in Milan as their current bases, in the bustling heart of Milan, behind La Scala theater, are too small to house those seeking to relocate.
Goldman has about 20 people on its payroll in Milan – Italy’s financial capital – but expects headcount to double by 2019 as a result of Italian bankers returning from London, said the sources who declined to be named as the plans are confidential.
JPMorgan, which has a much bigger presence of about 160 staff, aims to significantly increase that number, they added.
“Hiring bankers from London used to be hard, no one was too keen to relocate as London was the place to be in finance. But things have changed,” said Leopoldo Attolico, the Italy country manager for Citi, which has 200 Milan staff and expects some workers to seek relocation from London.
“Now there is a sense of insecurity among non-UK nationals working in London and we have seen more interest in relocating to Milan, also thanks to new fiscal incentives.”
For those returning, Italy is offering significant perks, including a 50 percent income tax break. There is no mass exodus, however, with only dozens of Italians choosing to relocate so far.
But the shift points to a growing fragmentation of the European investment banking sector, which has been almost exclusively concentrated in London for the past 20 years.
As Brexit nears, more financiers are expected to shift to their home countries or to other financial hubs like Frankfurt and Paris. This would increasingly spell the end of a model that has allowed banks to streamline operations and costs by covering European markets out of Britain.
“You don’t move back to Italy to get a tax break, but it’s a good incentive when you’re thinking about your next step,” said former DBAY investment adviser Raffaele Petrone who returned to Italy in February to join private equity firm Armonia SGR.
Antonino Mattarella, nephew of Italian president Sergio Mattarella, is also among bankers making the switch. In February the 38-year-old, who spent 12 years in London at Goldman Sachs, became Bank of America’s Italy head in Milan.
Some private equity and hedge fund executives have shifted too.
Giuseppe Prestia, partner at Charterhouse, has just relocated to Milan after handling the private equity house’s Italian investments out of London for 13 years, and his firm is considering opening its own base in Italy, according to the sources.
London-based buyout funds Cinven and Advent have started beefing up their Milan subsidiaries, with Advent director Francesco Casiraghi being the first to relocate, they said.
Over the past two decades, thousands of graduates have left Italy due to a lack of work and career prospects, with London a favorite destination.
In a bid to reverse this brain drain the government has introduced the 50 percent, five-year income tax break for high-skilled Italian workers returning from abroad, as well as a flat tax rate of €100,000 on foreign income aimed at luring the wealthy of all nationalities.
Fabrizio Pagani, chief of staff for Italy’s finance minister, has been organizing international events to promote Milan as a financial center. “We have seen a lot of interest around these new fiscal policies, especially the one offering a 50 percent tax holiday,” he said.
Milan still has a long way to go to come close to rivaling London or New York. Its share of global foreign currency trading is 0.3 percent compared with 36.9 percent in London, according to the Bank for International Settlements, while Italy lags Britain, France and Germany for investment banking fees.
But there are other attractions for affluent financiers.
Known as a hub for world-class design, fashion and food, the city of 1.3 million people boasts 17 Michelin-starred restaurants among about 7,000 bars, cafes and eateries. It is also marketing itself as a modern banking center with the newly developed Porta Nuova financial district reshaping the skyline.
“More than €6 billion has been invested in office space in Italy over the past 24 months, a significant part of which went to Porta Nuova,” said Manfredi Catella, CEO of real estate investment firm Coima.
Apartments in prime areas like the Brera district cost about $12,000 per square meter versus an average of $25,000 in London’s exclusive Mayfair.
“For someone from London buying in Milan is like going to the supermarket,” said Vincenzo Albanese, CEO of estate agency Sigest.
Albanese said financial-sector workers in London had been sounding out the Milan property market over the past year with top-floor terraced apartments in high demand.
International schools are also reporting a pick-up in interest.
“We had a lot of interest from Italians working in London who decided it was time to come back. This has been a trend since Brexit,” said Chris Greenhalgh, principal at the British School of Milan.
Greenhalgh said Milan’s municipality recently gathered all international schools and asked them to provide details about their capacity as part of a pitch to lure people from London.
St. Louis School recently added a third school to its Milan network in expectation of a boom in demand from returning Italians, converting a former monastery into a 600-place school.
Ahead of Brexit, tax perks tempt Italian bankers back to la dolce vita
Ahead of Brexit, tax perks tempt Italian bankers back to la dolce vita
Fortune Global Forum to be held in Riyadh in 2025
The forum, which is organized by Fortune magazine, brings together top business leaders from across the globe on the dynamic frontiers of global enterprise.
Fahd bin Abdulmohsan Al-Rasheed, the chairman of the Saudi Convention and Exhibitions General Authority, said the forum has in the past 30 years brought together “the titans of industry around the world to the forefront of economic development.”
“And that forefront today is the Kingdom of Saudi Arabia,” Al-Rasheed told the forum in New York, where delegates have been taking part in the three-day gathering, which concluded on Tuesday.
He urged delegates to come to the Kingdom’s business epicenter to engage and explore what Saudi Arabia has to offer.
Israeli anthem booed, scuffles seen at France game
- Some 100 Israeli fans come to game despite warning
- * Police seek to avoid violence seen in Amsterdam
PARIS: Some French fans booed the Israeli national anthem and there were minor scuffles inside a sparsely-attended Stade de France on Thursday for a Nations League game overshadowed by frictions around the Gaza war.
Seeking to prevent a repeat of violence in Amsterdam last week around a Europa League game involving Maccabi Tel Aviv, 4,000 French security personnel were deployed in and around the stadium and on public transport.
Some 100 Israel fans defied a warning from their government against traveling for sports events, sitting in a corner of the 80,000-capacity stadium which was barely a fifth full.
With many staying away due to security fears, the 16,611 attendance was the lowest for Les Bleus at the Stade de France since it opened in 1998. The match ended 0-0.
Some boos and whistles were heard during the playing of the Israeli national anthem, which was then turned up on loudspeakers. Israeli fans waved yellow balloons and chanted “Free the Hostages” in reference to compatriots held by Hamas militants.
As the match got underway, there was a melee near the Israel fans’ section for several minutes, with people seen running and punches thrown. Stewards quickly formed a barrier.
It was unclear what had triggered the trouble.
Leading up to the game, several hundred anti-Israeli demonstrators had gathered at a square in Paris’ Saint-Denis district, perimeter, waving Palestinian flags, as well as a few Lebanese and Algerian ones, to protest against the match.
“We don’t play with genocide,” one banner read, in reference to the Gaza war.
At the end of the match, two Palestinian flags were displayed at the south end of the stadium.
Israel denies allegations of genocide in its more than year-long offensive against Hamas.
Macron attends
Going into the ground, some Israel fans wore both Israeli and French colors. Two wore a t-shirt with Israeli club side Maccabi Tel Aviv’s logo on the front and the words “Ni Oubli Ni Pardon” (Never Forgive Never Forget) on the back.
One person held a paper with “f*** Hamas” written on it.
French Interior Minister Bruno Retailleau said this week there was never any doubt the match would go ahead, following the unrest in Amsterdam which saw both Maccabi fans and local groups engage in violence, according to Dutch police.
He said there were no specific threats identified ahead of the game, but that zero risk did not exist.
French President Emmanuel Macron was at the game in a show of solidarity. “We will not give into anti-Semitism anywhere and violence, including in France, will never prevail, nor will intimidation,” he told BFM TV hours before kickoff.
The match came a day after the ninth anniversary of coordinated Islamist attacks on entertainment venues across the French capital, including the national stadium.
Racism and intolerance are rising in France, fueled in part by the war in Gaza after the Hamas attacks on Israel in October 2023. Similar trends have been witnessed elsewhere in Europe.
Nearly 70 suspects have been arrested and at least five people were injured in last week’s clashes between Maccabi fans and gangs in Amsterdam.
Sri Lankan president’s coalition heads for landslide: early results
COLOMBO: New Sri Lankan President Anura Kumara Dissanayake’s party was headed for a landslide win at snap legislative elections, initial results showed Friday.
With over half of the ballots in Thursday’s parliamentary elections counted, Dissanayake’s National People’s Power (NPP) coalition party had taken an unassailable lead with 63 percent of the vote, Election Commission results showed.
UK unveils finance reforms, ups risk-taking to drive growth
- Finance minister announced plans to “modernize” the Financial Ombudsman Service, which deals with complaints between consumers and firms
- Called for “free and open trade” with partners such as the United States under its incoming president Donald Trump
LONDON: Britain’s Labour government on Thursday announced reforms to its financial sector in a bid to grow the economy, including a plan to allow greater risk-taking.
Finance Minister Rachel Reeves outlined the plans in her first Mansion House speech — an annual address by the chancellor of the exchequer to business leaders.
Late Wednesday she announced plans to create mega pension funds, potentially boosting investment in the country by around £80 billion ($104 billion) in a move that mirrored schemes in Australia and Canada.
Reeves used her Mansion House address to say that measures brought in since the 2008 global financial crisis to “eliminate risk” have had “unintended consequences” in holding back growth.
“While it was right that successive governments made regulatory changes after the global financial crisis to ensure that regulation kept pace with the global economy of the time, it is important that we learn the lessons of the past,” she said.
“These changes have resulted in a system which sought to eliminate risk-taking. That has gone too far and, in places, it has had unintended consequences which we must now address.”
Reeves announced plans to “modernize” the Financial Ombudsman Service, which deals with complaints between consumers and firms.
A pilot scheme will meanwhile be launched to deliver digital bonds, embracing technology used by the cryptocurrency sector.
She called for “free and open trade” with partners such as the United States under its incoming president Donald Trump.
“There is so much potential for us to deepen our economic relationship on areas such as emerging technologies,” she said.
“I look forward to working closely with president-elect Trump and his team to strengthen our relationship in the years ahead.”
She added that Britain must “reset our relationship” with the European Union after Brexit.
The “megafunds” pensions plan could unlock vast sums “for infrastructure projects and businesses of the future,” the Treasury said.
Labour aims to pool assets of 86 local government pension schemes in England and Wales.
The Treasury added that together the schemes were on course to manage £500 billion in assets by 2030.
Prime Minister Keir Starmer’s new government also plans to consolidate workers’ defined contribution schemes, a common form of pension.
“These megafunds mirror set-ups in Australia and Canada, where pension funds take advantage of size to invest in assets that have higher growth potential,” the Treasury said.
Reeves hiked business taxes and government borrowing in her maiden budget at the end of October.
“Last month’s budget fixed the foundations to restore economic stability and put our public services on a firmer footing,” Reeves said in comments alongside the pensions announcement.
“Now, we’re going for growth. That starts with the biggest set of reforms to the pensions market in decades to unlock tens of billions of pounds of investment in business and infrastructure.”
She added that the reforms would also “boost people’s savings in retirement and drive economic growth.”
Some analysts urged caution over the pensions shakeup.
“The government’s hope will be... economies of scale,” noted Tom Selby, director of public policy at investment platform AJ Bell.
He added that “conflating a government goal of driving investment in the UK and people’s retirement outcomes brings a danger.”
“If it goes well, everyone can celebrate. But it’s clearly possible that it will go the other way, so there needs to be some caution in this push to use other people’s money to drive economic growth.”
Spy world vexed by Trump choice of Gabbard as US intelligence chief
- Intelligence officials worry about Gabbard’s views on Syria, Russia
- Western security source warns of slower intelligence sharing
WASHINGTON: President-elect Donald Trump’s choice of Tulsi Gabbard as US intelligence chief has sent shockwaves through the national security establishment, adding to concerns that the sprawling intelligence community will become increasingly politicized.
Trump’s nomination of Gabbard, a former Democratic congresswoman who lacks deep intelligence experience and is seen as soft on Russia and Syria, is among several high-level picks that suggest he may be prioritizing personal allegiance over competence as he assembles his second-term team.
Among the risks, say current and former intelligence officials and independent experts, are that top advisers could feed the incoming Republican president a distorted view of global threats based on what they believe will please him and that foreign allies may be reluctant to share vital information.
Randal Phillips, a former CIA operations directorate official who worked as the agency’s top representative in China, said that with Trump loyalists in top government posts, “this could become the avenue of choice for some really questionable actions” by the leadership of the intelligence community.
A Western security source said there could be an initial slowdown in intelligence sharing when Trump takes office in January that could potentially impact the “Five Eyes,” an intelligence alliance comprising the US, Britain, Canada, Australia and New Zealand.
The worry from US allies is that Trump’s appointments all lean in the “wrong direction”, the source said.
Trump’s presidential transition team did not immediately respond to a request for comment.
Inside and outside the US intelligence network, much of the anxiety focuses on Trump’s choice of Gabbard, 43, as director of national intelligence, especially given her views seen as sympathetic to Russia in its war against Ukraine.
While Trump has made some conventional personnel decisions such as that of Senator Marco Rubio for secretary of state, Wednesday’s announcement of Gabbard, an officer in the US Army Reserves, surprised even some Republican insiders. She is likely to face tough questioning in her Senate confirmation hearings.
Gabbard, who left the Democratic Party in 2022, has stirred controversy over her criticism of President Joe Biden’s support for Ukraine, which has prompted some critics to accuse her of parroting Kremlin propaganda.
She also spoke out against US military intervention in the civil war in Syria under former President Barack Obama and met in 2017 with Moscow-backed Syrian President Bashar Assad, with whom Washington severed all diplomatic ties in 2012.
The selection of Gabbard has raised alarm in the ranks of intelligence officers unsure of how tightly she holds some of her geopolitical views, whether she is misinformed or simply echoing Trump’s “Make America Great Again” followers, one intelligence official said on condition of anonymity.
“Of course there’s going to be resistance to change from the ‘swamp’ in Washington,” Gabbard said in a Fox News interview on Wednesday night. She said voters had given Trump “an incredible mandate” to move away from Biden’s agenda but offered no policy specifics.
Allies attentive
A senior European intelligence official said agencies in European Union countries “will be pragmatic and ready to adapt to the changes.” “No panic in the air for now,” the official added.
A European defense official described Gabbard as “firmly” in the Russia camp.
“But we have to deal with what we have. We will be attentive,” the official said.
Some analysts said concerns about Gabbard could be tempered by Trump’s choice to head the CIA: John Ratcliffe, a former congressman who served as director of national intelligence at the end of Trump’s first term.
Though close to Trump and expected to offer little pushback against his policies, Ratcliffe is not seen as an incendiary figure and could act as a counterbalance to Gabbard in his post atop the No. 1 spy agency among the 18 that she would oversee.
But some analysts said that by attempting to install Gabbard with other controversial loyalists, including congressman Matt Gaetz for attorney general and Fox commentator and military veteran Pete Hegseth for defense secretary, Trump is showing he wants no guardrails to his efforts to remake federal institutions.
Democratic critics were quick to pounce not only on Gabbard’s views but what they see as her lack of qualifications and the potential the new administration could deploy intelligence for political ends.
The Office of the Director of National Intelligence was created after the Sept 11, 2001 attacks to fix what was seen as a lack of coordination between those organizations.
“She isn’t being put in this job to do the job or to be good at it. She’s being put there to serve Donald Trump’s interests,” US Rep. Adam Smith, the ranking Democrat on the House Armed Services Committee, told CNN on Thursday.
Support for isolationist policies
After leaving the Democratic Party, Gabbard became increasingly critical of Biden and grew popular among conservatives, often appearing on far-right TV and radio shows, where she became known for supporting isolationist policies and showing disdain for “wokeness.”
Shortly after Russia launched its invasion of Ukraine in 2022, Gabbard wrote in a social media post: “This war and suffering could have easily been avoided if Biden admin/NATO had simply acknowledged Russia’s legitimate security concerns regarding Ukraine’s becoming a member of NATO.”
Rubio, a former Trump rival turned supporter, defended Gabbard’s nomination, describing her as a “revolutionary pick that has a chance to really make a positive change.”
But some other Republicans were more non-committal.
Asked about Gabbard’s qualifications, Senator John Cornyn, a member of the Intelligence Committee, said: “We’re going to do our job, vet the nominees and make a decision. That’s a constitutional responsibility of the Senate.”
To become director of national intelligence, Gabbard must first be confirmed by a majority of the 100-member US Senate, where she could face headwinds.
Trump’s fellow Republicans will have at least a 52-48 seat majority in the chamber starting in January, and have in the past been eager to back the party leader, increasing the likelihood that she will secure the post.
“Our friends are watching as closely as our foes, and they are asking what this all means for the pre-eminent player in global intelligence collection and analysis,” said one former US intelligence officer who worked in some of the world’s hotspots.
