Deutsche Bank ‘to quit London over Brexodus’ with retreat to Frankfurt
Deutsche Bank is preparing to move vast parts of its London operation back to Frankfurt in response to the UK’s decision to part from the European Union (EU), bank insiders have revealed to media outlet Bloomberg on condition of anonymity.
Most of the trading and investment business done by the bank, which is Germany’s largest lender, will be transferred to a new booking centre in Frankfurt, the sources claim, leading to the loss of 20,000 client accounts in the UK and a concomitant loss of several hundred traders’ jobs.
The move is likely to be completed within 18 months, though those arguing for a soft Brexit and the possibility of remaining in the single market will take some solace from the source’s disclosure that the whole plan could be suspended should the UK’s Brexit scenario change substantially.
Deutsche Bank chief executive John Cryan has been on the record in the past in signalling his desire to move the lender’s operations back to its heartland in Germany’s fifth-largest city, the country’s financial hub.
“It’s another milestone in what we call the Brexodus,” Gildas Surry told Bloomberg, who helps oversee about €1bn euros (US$1.1 bn) at Axiom Alternative Investments in London, including Deutsche Bank bonds and shares.
“Every single continental European bank is working on plans to repatriate their trading and plumbing in their home cities.”
Part of the problem relates to the loss of freedom of movement that would result from Brexit, with many of the bank’s German employees in London facing uncertainty, though another bank insider played down the immediacy of any move, claiming that the move to a Frankfurt booking centre would be gradual.
Such a move, this source pointed out, would be a huge operation, with big investments required in new offices in the German financial capital, as well as in infrastructure and technology.
Hard Brexit blow
The news is another blow to those in the Conservative Party and UK government pushing for a hard Brexit, and would be another scalp for Frankfurt in its unabashed campaign to claim the trophy of European financial capital from London over Brexit.
In recent weeks, Standard Chartered, Nomura Holdings, Sumitomo Mitsui Financial Group and Daiwa Securities Group have selected Frankfurt as their EU hub.
In another blow to the City, Citigroup, Goldman Sachs Group and Morgan Stanley are also believed to be seriously considering following those companies to the banks of the river Main.