In the wake of the Brexit vote, the European Banking Authority has to relocate.
The Brexit has been talked about for a long time – now things are starting to move. More and more banks are deciding to transfer their activities from London to Frankfurt. Deutsche Bank and Citigroup are two prominent examples. But major institutions like the European Banking Authority (EBA) are also on the verge of choosing a new location. After all, the EU’s banking regulator has to be based in a member state of the EU.
The application process surrounding the EBA is long underway and it’s also clear since the end of July exactly who has thrown their hat into the ring: eight cities – Frankfurt and Paris, along with Brussels, Dublin, Prague, Luxembourg, Vienna and Warsaw – all want to offer the authority a new home. The reason is simple: the presence of such a significant institution enhances the standing and prestige of the host location enormously.
Eight candidates in the running
Accordingly, the eight candidates are busily committed in their efforts to broadcast their merits with lots of facts about their respective locations, for instance on infrastructure, transport links, working conditions and schools. But to some extent they’re also making concrete promises. Luxembourg and Vienna, for example, are offering rent-free office space.
Frankfurt wants to make a persuasive case with hard facts, and Volker Bouffier, Prime Minister of the State of Hesse, is not alone in his conviction: “Despite our many competitors, we have a good hand.” The government has put together a comprehensive dossier to explain why that’s true. It highlights all the aspects that are important when choosing a location. However, since many of the features that make up the special setting and ambience in and around the Main metropolis are difficult to convey on paper, Frankfurt is also presenting itself with a film that shows what it means to be at home in Frankfurt.
Frankfurt can score in every respect
It’s the combination of the many different elements that’s decisive, Prime Minister Bouffier is also certain. As he points out, Frankfurt can boast a very good infrastructure and a large number of international banks and insurance companies and is thus the most important financial centre in continental Europe. The existing supervisory structure, including the European Central Bank (ECB), the Insurance and Occupational Pensions Authority (EIOPA), the Deutsche Bundesbank, the German Federal Financial Supervisory Authority (BaFin), the European Systemic Risk Board (ESRB) and the Single Supervisory Mechanism (SSM), completes this unique network of relevant players at one place.
That the settlement of the EBA would be a logical next step and would also create synergies is beyond question for Bouffier. German Finance Minister Wolfgang Schäuble also stresses that it’s now important to ensure planning security at an early stage in view of all the risks and uncertainties the European Union will be faced with as part of the Brexit: “This also applies to the question of the future headquarters of the EBA. I am firmly convinced that a key combination of factors make Frankfurt am Main the best option.”
Attractive offer for companies and institutions
Frankfurt’s application has been intensively prepared by numerous experts. One of them is Dr. Rainer Waldschmidt, Managing Director of Hessen Trade & Invest GmbH (HTAI). His familiarity with Frankfurt and the region is second to none, and he knows from many discussions with companies and political decision-makers in London what the burning questions are that arise during any relocation.
Not the loud beating of one’s own drum, but substantial, fact-based persuasion is the best way to support the decision-making process in his experience. “Many companies are looking for a safe haven in the EU following the Brexit decision. We want to make them an attractive offer. We can effectively provide them with a unique network of all the relevant actors,” says Waldschmidt.
Together with many other representatives from the city and state, he is promoting Hesse as an outstanding location in the EU – not least for one of the central authorities like the EBA.
Since August 1st, all applications for future EBA locations have been published on the European Council website. The German government’s application for the Federal Republic of Germany and the location of Frankfurt am Main can be viewed on the website of the Federal Ministry of Finance.
You can read more about this topic here:
- Frankfurt’s international talent pool reaching new depths
- “Influx to Frankfurt – chances for the city as business location, financial centre and modern metropolis” – interview with Dr. Rolf E. Stokburger, Managing Partner, Germany, at Boyden