Deutsche Bank’s plans for life after Brexit have become much clearer with the instalment of a Frankfurt booking office. The group’s focus on Frankfurt represents its latest efforts towards a contingency plan for the UK’s departure from the EU.
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Back in April, Deutsche Bank was contemplating the move of approximately 4,000 jobs from London to Frankfurt given the uncertainty surrounding Brexit. Deutsche Bank’s Chief Regulatory Officer Sylvie Matherat echoed the group’s contingency plans at the time – Deutsche Bank has over 9,000 staff in the UK, of which 7,000 are located in London.
Previously, the Bank of England called for a mid-July deadline for UK-based banks to provide the regulator with detailed plans about their Brexit strategy. This coincides with a string of recent announcements from a plethora of lenders all publicizing their plans after months of chatter.
The decision by Deutsche Bank and others to relocate their EU headquarters has also been driven by a potential cessation of passporting rights to the country, which to date are anything but guaranteed. UK PM Theresa May has insisted that passporting would be curtailed for lenders, however her recent electoral setbacks have led to signs of a softened Brexit stance in recent months.
Native advantage
A strategic shift towards Frankfurt would also be a huge win for the city, which would in essence secure the billions of euros in non-European business that Deutsche Bank conducts via its London broker dealer. As the largest EU bank branch operating in the UK, Deutsche Bank’s move to Frankfurt could displace Dublin as the next EU banking Hub .
Unlike other rival lenders that have yet to fully procure German banking licenses, Deutsche Bank is working with a home field advantage. The lender already boasts excess space in a city where offices might be its most finite resource, a huge advantage relative to other groups.
