T Rowe Price chooses Luxembourg for EU head office

US asset manager to bulk up presence in Grand Duchy in anticipation of Brexit

US asset manager T Rowe Price is planning to strengthen its Luxembourg unit, which will become its head office for European Union (EU) business post-Brexit, the Financial Times has reported.

A spokesperson for the company confirmed the changes to the Luxembourg Times.

She said the company was ensuring it had “sufficient resources” in Luxembourg but denied any “redirect” from London, as suggested by the FT.

The $1-trillion (€805 billion) asset manager applied to the Commission de Surveillance du Secteur Financier (CSSF) two weeks ago to separate its UK and Luxembourg operations, according to the FT.

The separation will result in the asset manager’s Luxembourg division becoming the new head office for its EU business, to which the Madrid, Milan, Zurich, Frankfurt, Amsterdam, Copenhagen and Stockholm units will report.

“We took a decision last year that we needed to get started on this now if we were going to be ready in time,” Robert Higginbotham, head of global investment services at T Rowe Price, told the FT, adding that he expected the Luxembourg operation to be established by this summer.

Asset managers have been stepping up the implementation of their Brexit plans in recent weeks as the negotiations clock keeps ticking with no clear outcome in sight.

In February, the European Commission caused concern in the City of London after it reiterated that UK fund managers would no longer be able to sell products in the EU market once the UK leaves.

In recent months, several asset managers have bolstered their offices in Luxembourg – the largest fund-administration centre in Europe and the second largest in the world after the US – as they set their post-Brexit plans in motion.