Deutsche Bank 'moving assets from UK to Frankfurt'

FRANKFURT • Deutsche Bank is preparing to move large parts of the trading and investment-banking assets it currently books in London to its hometown of Frankfurt in response to Britain's exit from the European Union, people familiar with the matter said.

Germany's largest lender would move most of the business reported in London to a so-called booking centre in Frankfurt under the plan, said the people, who requested anonymity because discussions are not public. Deutsche Bank declined to comment.

The jobs of several hundred traders and as many as 20,000 client accounts will likely be moved as well, said another person. The strategy, which is still being finalised and would be reviewed if the Brexit scenario changes, will probably be implemented over the next 18 months, the people said.

A year after Britain's decision to exit the EU, the world's biggest banks are eyeing potential alternative locations for some of their London operations. The turmoil triggered by Brexit has dovetailed with Deutsche Bank chief executive officer John Cryan's desire to move the troubled lender closer to its base in Frankfurt, Germany's financial hub.

"It's another milestone in what we call the Brexodus," said Mr Gildas Surry at Axiom Alternative Investments in London. "Every single continental European bank is working on plans to repatriate their trading and plumbing to their home cities. "

If Britain were to lose passporting rights granted to EU members, Deutsche Bank would probably have to turn its London branch, where it books most of its British investment-banking business, into a subsidiary that would require capital, according to one person.

The transition to a Frankfurt booking hub would be gradual and will require investments in infrastructure, technology and office space, another person said.

Frankfurt has emerged as a winner of the Brexit vote, with Standard Chartered, Nomura Holdings, Sumitomo Mitsui Financial Group and Daiwa Securities Group picking the city as their EU hub in recent weeks. Citigroup, Goldman Sachs Group and Morgan Stanley are weighing a similar move.

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A version of this article appeared in the print edition of The Straits Times on July 07, 2017, with the headline 'Deutsche Bank 'moving assets from UK to Frankfurt''. Print Edition | Subscribe