Movement in the banking world – the Brexit and its repercussions

Negotiations have started on the withdrawal of the United Kingdom from the European Union. One important issue is whether the processing of euro-denominated securities transactions (“euro clearing”) will remain in London or take place on the continent in future. Many banks are getting ready to relocate their business to other cities.

 

Deutsche Bundesbank: first applications from banks affected by the Brexit

In June, Michel Barnier, the European Commission’s Chief Negotiator, and David Davis, the UK’s Secretary of State for Exiting the European Union, met for the first time in Brussels to negotiate the withdrawal of the UK from the EU. At the same time, deliberations are well underway within the banks about relocating to other European financial centres. According to the Deutsche Bundesbank, the first financial institutions affected by the UK’s withdrawal from the EU have applied for German bank licences. Andreas Dombret, Executive Board member of the Deutsche Bundesbank with responsibility, inter alia, for banking and financial supervision, spoke in an interview about “first applications”. Dombret also said that he has conducted “two dozen talks” with banks considering relocating to the European continent, but he doesn’t assume that every one of these discussions will end up in a move to Germany. “I expect most banks to make their relocation decisions by the middle of the year. But that doesn’t mean the banks will be publicising them,” he added.

 

Standard Chartered sets up the necessary infrastructure for bank licence in Germany

One of the first institutions to expand its business location in Frankfurt following the UK vote in favour of Brexit is the major British bank Standard Chartered. “We will now be establishing the necessary infrastructure on the basis of which we can apply for a bank licence in Germany,” the bank’s German head Heinz Hilger told the news agencies dpa and dpa-AFX. “Our plan is to have the operational issues settled by the end of 2018 at the latest.” Hilger explained that the decision for Frankfurt was taken because the bank in Germany, with its current level of around 100 employees, already has the largest presence in Europe after the London headquarters. “This is bound up with the fact that we operate the so-called euro clearing from Germany. This makes the location larger and more complex, and therefore more suitable for additional tasks and activities.” In addition, the proximity to the regulatory authorities, the city’s internationality and its airport are also among the key merits and advantages of the Main metropolis. Just how many employees will join the Frankfurt location depends on how hard the Brexit will turn out to be, he points out. “As a first step, we’re talking about a very limited number of employees coming to Frankfurt, maybe 20. Nobody can reliably predict at the moment how many people will ultimately be affected.”

Goldman Sachs: “We are starting to transfer resources to Frankfurt and other European cities”

Among the big banks that already have a German banking licence is the Goldman Sachs Group. Around 200 people currently work for the company in Frankfurt’s Trade Fair Tower compared to around 6,000 employees in the City of London. Since the Brexit is now considered a certainty, Goldman Sachs will at least be doubling the number of its employees working in Frankfurt, according to Richard Gnodde, Vice-Chairman of The Goldman Sachs Group, Inc. and CEO of Goldman Sachs International. “We are starting to transfer resources to Frankfurt and other European cities. Employees with customer contact are moving closer to their clients, whether in Milan, Madrid or a different city,” said Gnodde in an interview with the Sunday paper Frankfurter Allgemeine Sonntagszeitung (FAS). Since the entire Brexit process is unpredictable, he considers it important to have “appropriate emergency plans” up one’s sleeve. He also hopes and trusts that a transitional period will follow at the end of the negotiations so that the financial sector can adapt to the new situation. “In the interest of the stability of the financial system, it’s important that the banks don’t have to move parts of their business back and forth very quickly. They need the time to build up resources; the financial supervision also needs to adapt.” In the competition to be Europe’s future financial centre, Gnodde sees a number of European cities in the running, including Paris and Dublin. But Frankfurt has the edge at the moment.

Invesco: attractiveness is falling for Great Britain and rising for Germany from the sovereign fund standpoint

Sovereign wealth funds assess the UK withdrawal from the European Union as negative, which is why the nation is now considered less attractive for investments in the long run – that’s the result of the “Global Sovereign Asset Management Study 2017” from the investment company Invesco. In view of the uncertainty about the taxation of imports or access to the EU Single Market, those surveyed also questioned “the future of Great Britain as an ‘investment hub’ for Europe”. On the other hand, according to the study, the attractiveness of Germany as an investment destination for sovereigns has continuously grown since 2015. The findings are based on face-to-face interviews with 97 leading sovereign funds, state pension funds and central bank managers, with the assets of those sampled totalling around 12 trillion US Dollars.

Introduction of the China Competence Center

The China Competence Center (CCC) of the Frankfurt and Darmstadt Chamber of Commerce and Industry is a platform for the Hesse-China economic exchange. It supports its member companies in all questions regarding China business, be it in the import/export, founding of a company, recruitment or other topics. At the same time, the China Competence Center acts as a contact point for the more than 550 Chinese member companies in the Frankfurt Rhine Main area. Each year, the CCC organizes some 30 events; releases publications and sends out a monthly newsletter. Website:http://www.frankfurt-main.ihk.de/international/china_competence_center/de/

Frankfurt Main Finance Cup

Frankfurt Main Finance Cup 2016 – Eintracht Frankfurt vs Celta de Vigo

Schwarz-weiß wie Scheeee! Das ist die SGE! On Sunday, August 14, the Commerzbank-Arena will again be filled with the joyous sounds of Eintracht Frankfurt fans cheering on their home team as the official opening game of the new season. Gates will open at 10 a.m. for the traditional season-opening party which will include plenty of activities, fun and games will throughout the day. The highlight will be the Frankfurt Main Finance Cup, a friendly match pitting Eintracht Frankfurt against Europa League contenders, Real Club Celta de Vigo, kicking off at 15:00. The game and the events around the stadium are included in the cost of the tickets.

Frankfurt Main Finance is proud to be a sponsor of the Cup for the third year in a row. In the previous two years, Eintracht has faced off against Inter Milan and F.C. Tokyo in front of more than 50,000 spectators. Hubertus Väth, Managing Director of Frankfurt Main Finance, weighed in on the importance of football for Frankfurt. “In London, every Monday begins with an analysis of the weekend’s games. With this in mind, Eintracht Frankfurt plays a big role when it comes to showing the bankers in the City and on Canary Wharf that Frankfurt is a world class Financial Centre. Once you’ve experienced an Eintracht game, you’re sure to become a fan. We hope to see more coming soon!”

The match against Celta de Vigo will be a great occasion, they finished 6th in La Liga last season and participate in the UEFA Europa League campaign coming up. One of their star players John Guidetti featured at EURO 2016 for Sweden. Eintracht and Celta have met before, pretty much 10 years ago the Eagles managed a 1-1 draw away to Celta in the UEFA Cup group stage.

More information and tickets for this year’s Frankfurt Main Finance Cup can be found on the Eintracht Frankfurt website.

Frankfurt Main Finance – New Website Reports on FinTech Activity in the Financial Centre

As part of an ongoing campaign to promote the Financial Centre Frankfurt as a leading FinTech hub, Frankfurt Main Finance has published their yearbook On the Move and refreshed their online presence. Both actions serve to better illustrate the FinTech activities in the Financial Centre and promote the local FinTech companies and their partners.

The new website, www.frankfurt-main-finance.com, shows which FinTech companies and institutions are already taking advantage of the enormous potential of the Frankfurt Rhine-Main region. Additionally, one can find current FinTech studies as well as a calendar featuring the numerous FinTech events in the area, like the conference BaFin-Tech 2016. Furthermore, the supporters and initiatives strengthening Frankfurt’s position as a FinTech Metropolis are listed in the new FinTech Database. Companies acting as service providers for FinTechs can also register in the database free of charge.

Another new feature on the Frankfurt Main Finance is the option to subscribe for the Financial Centre Newsletter containing news from the Financial Centre, suggested events and informative articles.

In addition to the new website, Frankfurt Main Finance is expanding their presence and efforts on Social Media. The success of this renewed effort is evident in the activities surrounding the Frankfurt Finance Summit where the designated hashtag, #FinSum16, was a top-trend in Germany on Twitter, especially within the financial sector. For continued updates on the Financial Centre, follow Frankfurt Main Finance on Twitter or LinkedIn.

Besides updates on the activities of Frankfurt Main Finance, the bilingual website also includes content regarding current topics concerning the Financial Centre, Frankfurt as an RMB Hub and the the city’s international activities.

“In addition to augmented content, Frankfurt Main Finance’s new online presence has a fresh and modern appearance. Visitors will find information more easily and quickly than before. Using the website should be enjoyable,” explained Dr. Lutz Raettig, Chairman of the Executive Committee of Frankfurt Main Finance.

 

Frankfurt Finance Summit 2016: Challenges of Digitalization

The countdown is running! The 6th Frankfurt Finance Summit takes place on May 12th, 2016 under the motto On the Move – the Future of Finance. In advance of this extraordinary conference, a short look at some of the topics with three of our renowned speakers.

Dr. Lutz R. Raettig, Chairman of the Executive Committee, Frankfurt Main Finance

“It’s a real game changer: We may be talking about tectonic moves or tectonic changes. We are all invited to discuss with prominent practitioners, with central bankers, with politicians, among all is our Finance Minister, Dr. Wolfgang Schäuble. So we are looking forward to go through a very interesting and exciting program with you.”

Carl-Ludwig Thiele, Member of the Executive Board, Deutsche Bundesbank

“Yet, we are at the beginning of a very interesting development. And right now, we are only just beginning to understand its impact on the financial system and the way we bank in the future.”

Roland Boekhout, Chairman of the Management Board, ING-DiBa AG

“Digitalization, the Internet of Everything and Industry 4.0 – they offer massive changes to all kind of industries, including financial services and banking in particular. Massive challenges to move along, but also massive opportunities to offer more convenience services to our customers.”

19.813 Students

19.813 Students

study at one of Hessen's private higher education institutions.

Source: IHK-Forum Rhein-Main

The presence of regulatory authorities in Frankfurt strengthens not only the finance industry but also the infrastructure of the Financial Centre. Frankfurt’s reputation as a regulatory hub is further augmented by European Supervisory Authorities selecting the Financial Centre as their home.

„The presence of regulatory authorities in Frankfurt strengthens not only the finance industry but also the infrastructure of the Financial Centre. Frankfurt’s reputation as a regulatory hub is further augmented by European Supervisory Authorities selecting the Financial Centre as their home.“

From: Wolfgang Hartmann, Vorstandsvorsitzender des Frankfurter Instituts für Risikomanagement und Regulierung (FIRM) - 2015

The Financial Centre Frankfurt is an important factor for both the economy of Hessen and Germany. Sustainable growth, competitive small and medium enterprises and long-term infrastructure projects are all made possible by a strong financial sector. Therefore, the State of Hesse supports the Financial Centre’s initiative Frankfurt Main Finance and will go to great lengths to ensure that the financial sector fulfills its economic function in contributing to the public good.

„The Financial Centre Frankfurt is an important factor for both the economy of Hessen and Germany. Sustainable growth, competitive small and medium enterprises and long-term infrastructure projects are all made possible by a strong financial sector. Therefore, the State of Hesse supports the Financial Centre’s initiative Frankfurt Main Finance and will go to great lengths to ensure that the financial sector fulfills its economic function in contributing to the public good.“

From: Tarek Al-Wazir, Hessian Minister of Economics, Energy, Transport and Regional Development and Member of the Executive Committee of Frankfurt Main Finance - 2015

Frankfurt’s strengths lie in the closely intertwined relationship between the real and financial economy that has grown over many years.

„Frankfurt’s strengths lie in the closely intertwined relationship between the real and financial economy that has grown over many years.“

From: Dr. Lutz R. Raettig, Chairman of the Executive Committee of Frankfurt Main Finance - 2015

17 City Partnerships

17 City Partnerships

are maintained by the City of Frankfurt.

Source: Stadt Frankfurt