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Wall Street weighs into Britain's EU vote: Goldman, JPMorgan back 'in' campaign

LONDON (Reuters) - Goldman Sachs and JPMorgan are making large donations to the campaign to keep Britain inside the European Union, sources said, highlighting the concern among some of the world’s biggest banks over the impact of a British exit.

Union flags and the Big Ben clocktower cover notebooks are seen on sale in London, Britain, Thursday December 17, 2015. REUTERS/Luke MacGregor

Goldman Sachs has agreed to donate a “substantial six-figure sum” according to one source, while JPMorgan was preparing to make a similar donation, another source familiar with the matter said.

Another U.S. bank, Morgan Stanley, is also likely to make donation but has yet to decide a sum to contribute, a source said. The bank declined to comment.

In the face of growing Euroscepticism among the British electorate and political pressure from within his own party, Prime Minister David Cameron has promised to hold a referendum on Britain’s EU membership by the end of 2017.

On Thursday, Cameron urged business leaders at the World Economic Forum in the Swiss resort of Davos to speak up about the benefits of Britain staying in a reformed EU.

Cameron is hoping to head off the threat of a British exit, or ‘Brexit’, by negotiating a deal on reforms to the bloc that address concerns about immigration, sovereignty and competitiveness at an EU summit next month.

He received some support on Thursday from French President Francois Hollande, who said none of Britain’s EU reform demands were “insurmountable”, but that they must not prevent the euro zone from pursuing further integration.

Cameron said very good progress had been made with the EU but that they were “not there yet”.

With British public opinion finely balanced and renegotiations with Cameron’s EU peers meeting resistance, multinational businesses in Britain are facing up to the risk that the vote could sever links with the country’s biggest trading partner.

The donations by three heavyweight U.S. banks with heavy European presence reflect the financial sector’s acute concerns that Britain’s role as a global financing hub and major trading center for the euro could be under threat if it gives up its membership.

British banks were more circumspect in pledging their support. A source familiar with Barclays said the firm had a policy not to make political donations, while a source with knowledge of Royal Bank of Scotland said the bank was waiting for clarity on the government’s position.


A spokesman for pro-EU group Britain Stronger in Europe, the expected recipient of the donations, said it had a broad range of backers: “This includes many small donors, philanthropists and businesses worried by job losses and price rises if we were to leave.”

Until a date for the referendum is set, campaigns on both sides can accept and spend donations without restriction. However they may be required to declare details of prior donors once the government sets a referendum date. Spending will be capped during the period immediately before the referendum.

The donations were dismissed as “no surprise” by Leave.EU, one of several pro-Brexit campaigns, which says the EU works against ordinary Britons and protects vested political and commercial interests.

“The referendum will be a campaign of the British people against the establishment of international bankers, multinational corporate tax dodgers and out-of-touch politicians,” said Arron Banks, the group’s co-founder.

Arch-Eurosceptic Nigel Farage, leader of the UK Independence Party whose popularity put pressure on Cameron to make the offer of a referendum, described the donations as “the unholy alliance of big banks and big politics.”

Cameron, however, is keen to enlist the support of businesses to help his reform agenda clear political hurdles in other European capitals, and to illustrate the damage that he believes leaving the bloc would do to the country’s economy.

“If business backs my reforms ... I would argue get out there and support those things,” he said in Davos.

“The sooner you can start to look at your own businesses and come up with the examples and the ideas about the benefits and the problems that there are with Europe the more that you are able to help to explain and set the context for this vitally important question.”

Additional reporting by Elizabeth Piper in Davos, Rachel Armstrong and Kylie MacLellan in London, Writing by William James; Editing by Guy Faulconbridge/Jeremy Gaunt