Dimon fires warning shot and wider industry reaction to new UK PM, Chancellor

Not for the first time, Jamie Dimon has showered outgoing UK finance minister Rachel Reeves with praise.
In an interview with The Master Investor Podcast with Wilfred Frost released on 21 July, Dimon said that he thought Reeves “did a great job”. Specifically, Reeves is credited with a commitment to medium-term fiscal prudence. That has helped to keep a lid on UK government bond yields.

Dimon declined to say what he might do if the new UK chancellor, John Healy increases the bank levy. Asked if that might lead Dimon to cancel plans to build a new £3bn UK headquarters in London, Dimon said: “I don’t know what I’d do. I wouldn’t make a binary decision like that.”

Dimon added: “The new chancellor [is] going to need good policies that actually cause growth. So, I’m praying that they get policy right [as] government after government get it wrong.”

Dimon is not however alone in warning the new chancellor of the possible consequences of a U-turn in terms of fiscal caution, with Nigel Green, predictably forthright, as noted below.

Wider sector reaction

Chris Beauchamp, Chief Market Analyst, IG

Dimon’s warning about the risks of taxing banks is what you’d expect from the sector, and the argument makes sense, but if Burnham is poised to go into full crisis mode over the need to find more cash, his words might have little impact. Burnham will also be aware that, in the short-term at least, the policy is hardly a vote-loser, defenders for banks being few and far between. Given the importance of banking and associated services to government revenues however, he does need to think carefully about trying to squeeze more out of the sector.

Nigel Green, CEO, deVere Group

Markets rallied recently on the assumption that a fiscally cautious figure would sit between Burnham and his own instincts on tax. This theory no longer holds.

Investors should reprice UK assets with that in mind.

Healey resigned from Cabinet last month demanding more money for defence and has pushed for spending to reach 3% of GDP by 2030. He now runs a Treasury under a Prime Minister who has ruled out raising income tax, VAT and National Insurance. That spending has to be funded somewhere, and wealth, capital gains and property are the obvious remaining options.

The UK lost an estimated 16,500 millionaires in 2025, one of the largest outflows recorded anywhere in the world, and forecasts already pointed to a further rise in 2026 before today’s appointment.

A week of calm markets was built on the expectation of restraint at the Treasury. What arrived instead is a Chancellor with a spending record and a mandate, by Downing Street’s own description, to execute rather than temper the Prime Minister’s plans. That is a materially different risk picture than the one priced in on Friday.

A wealth tax, an exit charge on departing assets, and a further rise in capital gains tax all look more likely with Healey at the Treasury than they did with Mahmood.

Burnham has removed the appointment that gave markets a reason for confidence.

Wealthy individuals and business owners should treat today as a prompt to act rather than wait. Reviewing residency options, diversifying where assets sit and building flexibility across jurisdictions is worth doing now, ahead of the Autumn Budget, rather than after it confirms the direction today’s appointment points toward.

Last week’s market rally was built on an appointment that never happened.

Healey’s record on spending, paired with Burnham’s manifesto constraints, points toward higher taxes on wealth, not lower.

This is the takeaway investors and wealth creators need to get from today, whatever the initial market reaction looks like.

Jonathan Herbst, Partner, Global Head of Financial Services, Norton Rose Fulbright

The appointment of a new Chancellor will naturally prompt questions about the future direction of financial services policy, but firms will be looking first and foremost for continuity and certainty.

The UK has made significant progress in reshaping its regulatory framework in recent years and businesses will be keen to see that momentum maintained. The priority is likely to be ensuring that reforms already under way continue to be delivered in a predictable and coordinated manner.

For internationally active firms, the UK’s attractiveness depends not just on the substance of the rules but on the stability of the regulatory environment. Areas such as capital markets, FinTech, digital assets and sustainable finance will continue to be important tests of that commitment.

Businesses are unlikely to be looking for a wholesale change of direction. What matters now is carrying existing reforms across the finish line and providing a framework that allows firms to plan, invest and grow.

Derek Ryan, CEO for North West Europe, Bibby Financial Services

Andy Burnham’s positive noises about rebalancing business rates will be welcomed by smaller high street retailers and SMEs. But we know from our own research that business rates cripple small businesses across sectors. This policy initiative needs to go further if the new Prime Minister is serious about delivering on his promise to create ‘good growth in every postcode’.
Last year’s increase in NI contributions halted many SME leaders’ investment and growth plans in their tracks, so the proposal to lower this tax would clearly make a significant positive difference. But the devil will be in the detail — not least the views of any new Chancellor. And who Mr Burnham picks as his new Chancellor, matters hugely because stability, not radical change, is what businesses need to invest with confidence.

Harry Woolman, Global Capital Markets Analyst, Validus Risk Management

Andy Burnham has appointed John Healey as Chancellor of the Exchequer in what many view as a surprise decision.

Healey is widely regarded as a safe pair of hands who is likely to deliver on Burnham’s agenda rather than pursue an agenda of his own. He has also previously served in a junior role at the Treasury.

Attention now turns to the new Prime Minister’s speech tomorrow, in which he is expected to announce policy measures aimed at easing the cost-of-living burden and set out how these will be funded. This will no doubt be high on the new Chancellor’s agenda for the foreseeable future.

The pound remains relatively unchanged following the announcement.