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The head of JP Morgan Chase has given final approval on a significant three billion pound office complex in the UK capital following assurances from government representatives about pro-business policies.

Timing of Developments

The major US bank, that together with Goldman Sachs announced significant expansion projects shortly following being spared tax increases in the UK government's financial statement, authorized the project last Friday.

This approval followed a visit to New York by Varun Chandra, that held discussions with the banking executive to discuss commitments about the UK's economic approach.

Budget Context

The meeting took place shortly prior to the Treasury announced £26bn in tax rises in a economic plan that protected financial institutions from increased charges, following intense lobbying from the banking community.

"The development ... would potentially been canceled if this financial plan had been perceived as hostile to financial services."

Development Information

On recently, the banking giant disclosed plans to develop a 3 million square foot headquarters in the docklands area, which will become its main London office and host more than half of its London employees.

The bank emphasized that the investment would be contingent upon "favorable economic conditions in the UK".

Economic Impact

The financial institution has indicated that the development could contribute £9.9 billion to the UK economy over the following six-year period.

The Treasury chief expressed enthusiasm about the project, calling it a "significant demonstration of faith in the British economic prospects".

Additional Context

A insider knowledgeable about JP Morgan's building plans noted that the investment choice was "the result of comprehensive analysis" and that "uncertainty remained whether financial institutions were going to be facing higher charges before the financial statement".

The banking executive remarked that the "UK government's priority of financial development has been a critical factor in influencing our this decision".

Parallel Announcements

Goldman Sachs disclosed that it would expand its Birmingham office and hire 500 staff, in a initiative that would more than double its employee numbers in the England's major regional center.

The Treasury had considered expanding the bank levy in the UK, as it considered ways to raise revenues after deciding against higher personal taxation, but eventually determined not to do so.

Financial institutions in the UK are subject to a increased business taxation, being exceeding the standard 25%, as well as a additional charge on their UK balance sheets.