Deutsche Bank said to weigh mov­ing € 300bn from UK

Muscat Daily - - BUSINESS -

Lon­don, UK - Deutsche Bank AG may shift about € 300bn from the bal­ance sheet of its UK en­tity to Frank­furt as client trad­ing and as­sets mi­grate to the con­ti­nent fol­low­ing Bri­tain’s de­ci­sion to leave the Euro­pean Union, ac­cord­ing to a per­son fa­mil­iar with the mat­ter.

The pro­ject, dubbed Bow­line, calls for trad­ing in the Ger­man city to go live in Septem­ber 2018 and for the as­sets to be moved over by March 2019, said the per­son, who asked for anonymity. Shift­ing € 300bn would be equiv­a­lent to al­most a fifth of Deutsche Bank’s bal­ance sheet, which listed € 1.59tn in to­tal as­sets at the end of last year.

Monika Schaller, a spokes­woman for Deutsche Bank, de­clined to com­ment.

CEO John Cryan told em­ploy­ees in a re­cent video­taped mes­sage that he’s gird­ing for a hard Brexit, with the ‘vast ma­jor­ity’ of trades cur­rently booked in Lon­don prob­a­bly mov­ing to Frank­furt, but the bank hasn’t of­fi­cially de­tailed its plan. Peo­ple fa­mil­iar with the mat­ter told Bloomberg that the lender in­tends to move chunks of trad­ing and in­vest­ment-bank­ing as­sets from Lon­don to Frank­furt, with the jobs of sev­eral hun­dred traders and as many as 20,000 client ac­counts likely to be shifted.

“There’s an aw­ful lot of de­tail to be ironed out and agreed,” Cryan said in the video. “But in- evitably roles will need to be either moved, or at least added in Frank­furt.”

Un­der Bow­line, trade and bal­ance-sheet mi­gra­tion will be­gin in Septem­ber 2018, with six months re­quired for the move of the bal­ance sheet, the per­son said. The bank plans to start in­form­ing clients from Septem­ber 2017 that their con­tracts will be switched to Frank­furt. It wants to have built front-to-back tech­nol­ogy and pro­cesses by June 2018, ac­cord­ing to the per­son.

Much of Deutsche Bank’s trad­ing in Europe is tra­di­tion­ally booked in Lon­don, which gained a prom­i­nent role for the bank un­der Cryan’s pre­de­ces­sors An­shu Jain and Josef Ack­er­mann.

Cryan has spent the past two years scal­ing back cap­i­tal-in­ten­sive debt trad­ing and set­tling mis­con­duct cases that oc­curred mostly be­fore his ar­rival. The Brexit-driven re­lo­ca­tion dove­tails with his re­or­gan­i­sa­tion of the in­vest­ment bank to em­pha­sise the cor­po­rate busi­ness in its home mar­ket.

Deutsche Bank’s Brexit plan­ning is over­seen by the two co-heads of Deutsche Bank’s in­vest­ment bank, Frank­furt-based Mar­cus Schenck and Lon­don­based Garth Ritchie, as well as the ex­ec­u­tive board mem­ber in charge of com­pli­ance, Sylvie Matherat.


A view of the head­quar­ters of Deutsche Bank in Lon­don, UK on May 5

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