Coronavirus sparks concerns over European financial operations

Regulators fear the absence of important staff could cause markets to seize up.

London Coronavirus
Workers, some wearing protective face masks, cross London Bridge during the morning rush hour in London, the United Kingdom, where banks are readying out-of-town offices and isolating some teams to ensure they can keep trading if coronavirus spreads [Toby Melville/Reuters]

HSBC has sent more than 100 of its London staff home after a worker tested positive for the coronavirus, the first known case at a major company in Europe’s main financial hub. 

Italy’s UniCredit also told some staff to go home after two new infections were reported among its employees – one in Germany and one in Italy. The possibility of the coronavirus spreading across the finance industry is worrying regulators, who fear the absence of important staff could cause markets to seize up if firms cannot operate their trading operations normally.

The European Central Bank has asked euro zone banks to urgently test their large-scale remote working arrangements, or other flexible working arrangements for critical staff, a letter dated March 3 that was seen by Reuters news agency showed.

German and British financial regulators have also said they are watching how prepared banks and other institutions are.

At HSBC, an employee in its research department in London self-isolated on Sunday, sources familiar with the matter told Reuters.

The employee was later confirmed to have the coronavirus and on Thursday morning the bank sent home more than 100 people from the research department, a bank spokeswoman said. HSBC has told staff who came into contact with him to work from home as areas affected undergo a thorough clean.

“We have been informed that one of our employees at 8 Canada Square has been diagnosed with COVID-19. This colleague is under medical supervision and has self-isolated,” the spokeswoman said. “All staff whose roles allow remote working have been told they can work from home if preferred.”

HSBC’s London office is in Canary Wharf, a major financial district that hosts many investment banks, including Citi, JPMorgan, Morgan Stanley and Barclays.

HSBC’s headquarters remains open, the bank said.

Meanwhile, the number of UniCredit workers infected with coronavirus reached three on Thursday. It sent home the staff who dealt with them.

UniCredit said it had told all employees who have been in contact with a contractor in its Munich office who has tested positive for the virus to self-quarantine for two weeks.

The bank has closed its Piacenza office, where another employee who has tested positive, and a branch in the northern Italian city, UniCredit said in a statement.

Italy has been hit harder by the coronavirus than any other country in Europe, with 107 deaths and more than 3,000 confirmed cases.

Banks globally are readying out-of-town offices and isolating some teams to ensure they can keep trading if coronavirus spreads in more significant financial centres.

Goldman Sachs has been testing a back-up site in Croydon, south London, and Citi has been preparing an office in Lewisham, southeast London, sources familiar with the matter said. JPMorgan is testing back-up locations in Basingstoke, to the southwest of the capital, and another city centre site.

In Spain, BBVA said on Thursday it had transferred up to 100 staff from its Madrid trading floor to a location just outside the city as part of its contingency plan to protect operations from potential disruption related to the coronavirus outbreak.

Source: Reuters