Banks, companies plan expansion in Frankfurt after Brexit

Posted by BankInfo on Sun, Jul 23 2017 10:22 am

Several hundred banks and companies have contacted German authorities about expanding in Frankfurt, as the city vies to become the EU’s principal financial centre after Brexit.

 Lucia Puttrich, Europe minister in the government of the state of Hesse, told the Guardian she had been in talks with several banks about expanding their presence in Frankfurt or the Rhine-Main area, reports The Guardian.

 US investment bank Morgan Stanley is the latest to choose the German city as the site of its post-Brexit European hub, it emerged this week, following official announcements from seven other banks, including Goldman Sachs and Standard Chartered, that they will expand operations in Frankfurt.

 Other institutions beefing up their Frankfurt offices include Daiwa, Sumitomo Mitsui and Nomura of Japan, VTB of Russia and Woori Bank of South Korea.

 “The movement will not be initiated immediately but it will be step by step,” Puttrich said. “ London will remain an important financial centre ...

[but] there will be a transfer from those who need to have an office in the European Union, because London will not be in the internal market.

 “People talk about several thousand [jobs coming to Frankfurt], but it is difficult to put a figure on it.”

 The state of Hesse has had “several hundred contacts with institutions in Great Britain and especially London”, a spokesman added, although many of these discussions were at an early stage. Some of these companies may opt for Paris, Dublin, Brussels or Luxembourg; others may not move.

 Nevertheless, the remarks may ring alarm bells that a banking exodus is gathering pace, following a warning from the City regulator that banks were approaching the point where they must move staff out of London to continue operating smoothly after Brexit. Jobs leaving the City have so far been relatively limited, however, compared with the 751,000 people working in London in banking and related professional services.

 Frankfurt, home to the European Central Bank and the German Bundesbank, already hosts the biggest European operations of US investment banks outside London.

 Researchers at the Bruegel thinktank have forecast that Frankfurt will take the biggest share of London’s post-Brexit business in a report that predicted the loss of 30,000 jobs in the City.

News:Daily sun/23-jul-2017
Posted in Banking, News