Frankfurt Hosts Largest Corporate Run in the World

On June 15, 2016, more than 68,000 runners from over 2,600 companies lined up at the starting line for the J.P. Morgan Corporate Challenge, making the event one of the largest running events in the world. Frankfurt’s financial sector was very visible as always. Deutsche Bank, for example, came out with a team of 1,327 runners! In addition to the race itself, companies and colleagues greeted their teammates in tents and grill parties all across the city, especially along the banks of the Main. Don’t miss out next year on the 25th anniversary of the race on June 13, 2017.

 

Photo Credit: J.P. Morgan Corporate Challenge

Frankfurt Real Estate

EY Study: Frankfurt Real Estate Market to Profit from Brexit

According to a recent study by EY Real Estate, surveying 555 respondents from the German real estate branch, the German and Frankfurt real estate market will be one of the main beneficiaries of the UK citizens’ vote to leave the EU.

The survey shows that 57% of respondents predict the Brexit having a positive effect on German real estate. According to the responses, the transactions volume, as well as the purchase and rental prices, are poised to increase. This increase in residential prices will specifically affect Frankfurt according to 86% of respondents. In addition, 79% predict an increase in commercial real estate prices.

These predictions are based on the expectation that Frankfurt will grow in importance following the UK vote to leave the EU. In fact, 72% of respondents expect the Financial Centre Frankfurt to benefit the most from the UK’s exit from the EU. Dublin follows in a very distant second with 13% and only 6% of respondents see Paris profiting from the Brexit.

Read the full results of the study here.

tagesschau – the Main benefits from Brexit

Following a meeting of the Financial Centre Cabinet, the German news programme reported on Brexit as an opportunity for Frankfurt. “Admittedly, Frankfurt isn’t considered as lively as London. Nevertheless, the city in Hesse estimates that the Brexit could bring 10,000 banking jobs from the Thames to the Main.” From Oliver Feldforth and Sandra Scheuring, Hessischer Rundfunk.

Watch the full story here!

Montagsgesellschaft – What does Brexit mean for Frankfurt?

Days before the EU referendum in the UK, Frankfurt’s Montagsgesellschaft (Monday Society) met to discuss the possible consequences of Brexit for Europe and the Financial Centre Frankfurt. Expert panellists, including Frankfurt Main Finance’s Managing Director Hubertus Väth, weighed in on possible outcomes. The overall mood at the Montagsgesellschaft was certainly that Brexit would be negative for the European Union and Europe, but could have certain positives for the Financial Centre Frankfurt.  Hubertus Väth explained after the event that, “We aren’t expecting nor do we want a Brexit to occur. Nevertheless, we will not waste a good crisis and are prepared to positively position the Financial Centre Frankfurt in the case it does.” Just four days later, all of Europe was shocked by the decision of UK citizens to leave the EU and trying to come to terms with the uncertainty that lay ahead.

On Monday, July 4, 2016, the Montagsgesellschaft convened again with the same panellists to further discuss the Brexit and its now more concrete consequences. During the last meeting, most were almost certain that a Brexit would not happen. However, the tone was quite different this week as most were only certain that Europe will face months if not years of uncertainty. The UK’s departure from the EU does, however, certainly mean that some financial institutions will need to reevaluate their London operations and very possibly relocate to another financial centre on the Continent. One example is the European Banking Authority, currently housed in London’s Canary Wharf. Hubertus Väth elaborated on this during the discussion, “Frankfurt is the natural choice for EBA’s relocation as the ECB and other bricks of the regulatory pillar are already here. EBA is one of the last missing pieces.” While this may only bring a few hundred jobs, it would also augment Frankfurt’s reputation as a regulatory hub, already being home to EIOPA, ESRB and BaFin.

Experts estimate that some 20,000 jobs could leave the Thames in for the Main. Quoting a recent study from the Boston Consulting Group, Väth explained that the Financial Centre Frankfurt actually ranks very highly amongst bank executives as an alternative to London. Amongst others, Frankfurt scores highly for economic and political stability, real estate costs, transportation infrastructure and the availability of a highly qualified workforce.

BaFin-Tech – Fintech caught between Regulation and Digitalisation

On June 28, 2016, Germany’s Federal Financial Supervisory Authority (BaFin) hosted a new conference, BaFin-Tech 2016, in Frankfurt. The sold out conference was attended by around 200 participants representing FinTechs, investors and the broader financial sector. The aim of the conference was to explore regulatory issues that could affect young FinTech companies and new business models. BaFin-Tech consisted of panel discussions and smaller workshops where attendees could gain closer insight into specific themes like Blockchain, Robo-Advisory, Crowdfunding or alternative payment methods.

In his opening address, President of BaFin Felix Hufeld explained that they operate under the principal of same business, same risk, same rules. Hufeld continued, elaborating that, “Supervisors are not a jury delivering verdicts on business concepts. We don’t put up barriers to insulate established companies and we don’t run an incubator for cool newcomers. We are supervision and will remain so. However, what we do want, is to align our administrative procedures accordingly for you as a growing and increasingly more important audience. Accordingly means understandable, fast and, as far as possible, electronic.” Hufeld even invited promising business models which may fall below the required threshold to work with BaFin.

The second panel discussed whether FinTech is a disruption or an innovation. This conversation juxtaposed those in the FinTech sector like Dr. Oliver Vins of vaamo with established actors like Michael Mandel of Commerzbank. After this discussion, FinTech can arguably be characterised as inspirational. While the new innovations from the start-ups may shake up business models and customer demands, it also inspires the old guard to put their full weight behind their digitalisation efforts. Mandel detailed that Commerzbank’s efforts, like integration with PayDirekt, and the board’s goal to completely digitise the customer experience. The conference ended with a reflection from Hufeld, who reminded the audience not to overlook all factors that go into deciding whether a technology is permitted, such as security, anti-money laundering and consumer protection.

As the German FinTech scene has grown substantially over the past year, BaFin-Tech 2016 clearly demonstrated that Germany’s top regulators take FinTech seriously and are invested in fostering innovation in Germany and Europe’s financial sector. The event also proved another advantage of the Financial Centre Frankfurt for young FinTech companies looking for a home. Frankfurt is not just a centre for finance in Europe but also a centre for regulation and supervision, home to the ECB, EIOPA in addition to BaFin.

You can find more information and the presentations from the event on the BaFin website.