LONDON — American banking giant Citi is set to become the latest major financial firm to choose Frankfurt for its post-Brexit EU hub, reports late on Monday suggested.
Sky News’ City Editor Mark Kleinman reports that the bank, which currently employs close to 9,000 people across the UK, plans to use the German financial centre as “the location for a major new trading operation.”
Citing “insiders,” Sky reports that Citi considered moving its EU hub to Paris, but eventually decided on Frankfurt, and will reveal its plan formally later this week. Citi has not commented on the report from Sky.
Financial centres across the EU — including Frankfurt, Paris, Dublin, and Luxembourg — are battling to attract financial services work moving out of London as a result of Brexit as a result of expected legal changes that will make operating in the EU out of London tricky.
Britain is expected to lose financial passporting rights, which allow banks with a base in the UK to sell products and services to customers and financial markets across the EU.
Frankfurt is emerging as a popular destination for many international firms choosing a post-Brexit base. Three Japanese lenders, Daiwa, Sumitomo Mitsui Financial Group, and Nomura, have all confirmed in recent weeks that they will set up new post-Brexit bases in Frankfurt.
However, a recent study from professional services giant EY suggested that Dublin is so far the post-Brexit favourite for financial firms.
Lobbyists in Frankfurt remain confident, especially when it comes to the lucrative euro clearing business. Hubertus Väth, managing director of lobby group Frankfurt Main Finance, told Business Insider earlier in July he was confident the EBA, Europe’s banking authority, would move to Frankfurt. He added that he believes euro clearing should move to the city if it does move from London.
He said: “We are confident about it. I cannot say it will be the likely decision of such a complex body as the European Union, but I think we have very good arguments for it.
“If you look at it from a rational point of view, then I think everything speaks for Frankfurt.”