British bankers could face a hefty pay cut if they relocate to the likes of Paris or Frankfurt after Brexit, but stand to gain better work-life balance outside of the UK, research has found.
Banking associates in the City could see their pay packages trimmed by more than 18% if they moved to Germany's financial centre, a number which widens to 25% for Paris, and 50% in Milan, according to salary benchmarking website Emolument.
Managing directors (MDs), meanwhile, stand to lose as much as 37% by moving to Frankfurt.
The study, which analysed 4,475 salaries for front office banking across the four cities, showed that on average, associates in London earned £109,000 including bonuses, while their counterparts in Frankfurt pocketed £89,000, those in Paris earned £81,000 and employees in Italy's financial hub £52,000.
"If London banks were to move their workforce to other European cities, average compensation packages would decrease. From analyst to MD, London offers the highest salaries and bonuses in the market," the report explained.
But it highlighted that remuneration structures can differ across jurisdictions, with higher base salaries but lower bonuses in Germany, while up to 49% of total banker compensation in Paris is made up in bonuses.
When taking London out of the picture, Frankfurt comes out on top for total associate and analyst pay packages among its continental peers.
Dublin, another contender in the post-Brexit banking exodus, was not included in the study as there was a lower number of front office staff to survey, compared to back office operations, Emolument explained.
Frankfurt emerged as the winner when it came to work-life balance, with 70% of its local respondents saying they were happy with their working lifestyle, compared to 67% in Milan, 59% in Paris and 61% in London.
"As regards moving away from London to other EU capitals, while pay may be lower, pain points such as schooling and generally higher quality of life should compensate bankers transferring to the continent," Alice Leguay, co-founder of Emolument, said.
But London comes out on top for its host of "open-minded" companies, with 49% giving the thumbs up to corporate culture, compared to 33% in both Paris and Milan and 31% in Frankfurt.
The research comes as a raft of international banks, insurers and asset managers are preparing to shift portions of their UK operations to the continent in preparation for Britain's divorce from the EU in the hope of safeguarding against the loss of passporting rights which currently give UK-based financial services cross-border access to the bloc.
Heavy-hitting US banks including JPMorgan and Goldman Sachs are planning to spread staff across a number of European cities including Frankfurt, while Mizuho will join a string of Japanese banks which have chosen the city as an EU hub, including Daiwa, Sumitomo Mitsui Financial Group (SMFG) and Nomura.
HSBC is one of a handful of firms that are turning to Paris, having said that 1,000 jobs may move to the French capital over the next two years depending on the outcome of Brexit negotiations.
Barclays, Legal & General and Bank of America have recently revealed plans to base EU-focused operations in Dublin after Brexit, while Luxembourg has gained commitments from the likes of US giant AIG, Northern Trust and insurers RSA and Hiscox.