US investment bank Citigroup is considering Frankfurt as a new European base for its markets and trading arm as part of its Brexit plan
Jim Cowles, Citigroup’s European chief, said “Germany is one of our favourites” as a location for the bank’s European base in an interview with German newspaper Frankfurter Allgemeine Zeitung published on Wednesday.
Citigroup has 370 people in Frankfurt and could shift 200 more to Germany’s financial centre from London to maintain access to the European single market after the UK leaves the European Union.
In January, UK Prime Minister Theresa May her Brexit plan in a speech signalling that Britain would leave the single market, which is a free trade bloc of European countries, in return for tougher immigration controls on EU citizens.
Financial firms in London will lose their ability to passport in to continental European clients from their UK base. Cowles said “it is the worst case and I think we have to adapt to it,” in the interview with FAZ.
Cowles said that Citi was attracted by the “professionalism” the German regulator BaFin and would make a final decision by the middle of the year.
In January Cowles said “our issue is with our broker-dealer which is located in the UK and it will lose, presumably, passporting rights,” at a banking conference in Ireland.
“We’ve reached out, we’ve talked to regulators and people at government across many countries in Europe, including Ireland, Italy, Spain, France, Germany and the Netherlands and we’re in the process of evaluating each one of them,” Cowles said.
Broker-dealers handle trades on behalf of clients such as funds or companies.
In the days after May’s speech signalling her desire for a so-called hard Brexit, HSBC, JPMorgan, and UBS have all warned about job relocations.
Jamie Dimon, CEO of JPMorgan Chase, told Bloomberg at Davos that the bank will likely move more people than previously thought. “It looks like there will be more job movement than we hoped for,” Dimon said. The bank employs 16,000 people in the UK.