Cit­i­group chooses Frank­furt as its new trad­ing hub

The Star Early Edition - - INTERNATIONAL - Bloomberg

US BANK Cit­i­group has cho­sen Frank­furt as its new­est trad­ing hub in the EU and plans to present that op­tion to its board of di­rec­tors this week for ap­proval, ac­cord­ing to a per­son with knowl­edge of the de­ci­sion.

The choice to ex­pand the bank’s ex­ist­ing bro­ker-dealer in the Ger­man city means it will cre­ate be­tween 150 and 250 new roles there, said the per­son, who asked not to be iden­ti­fied talk­ing about in­ter­nal poli­cies. It is yet to be de­cided if the jobs will be filled by mov­ing ex­ist­ing em­ploy­ees or by hir­ing lo­cally, and it’s likely to be some com­bi­na­tion, the per­son said.

The lo­ca­tion, where Cit­i­group al­ready has about 350 em­ploy­ees, is ex­pected to han­dle some of the trad­ing ac­tiv­i­ties cur­rently done in Lon­don, though the UK cap­i­tal will re­main the head­quar­ters for Europe, the Mid­dle East and Africa, the per­son said. Sky News re­ported the de­ci­sion on Mon­day.

Frank­furt has emerged as a win­ner of the Brexit vote, with Stan­dard Char­tered, No­mura Hold­ings, Su­mit­omo Mit­sui Fi­nan­cial Group and Daiwa Se­cu­ri­ties Group pick­ing the city as their EU hub in re­cent weeks. Deutsche Bank is pre­par­ing to move large parts of the trad­ing and in­vest­ment-bank­ing as­sets it cur­rently books in Lon­don to its home town of Frank­furt, peo­ple fa­mil­iar with the mat­ter said.

Cit­i­group has been con­sid­er­ing the move for months. The firm was eval­u­at­ing lo­ca­tions in Ire­land, Spain, Italy, Ger­many, France, and the Nether­lands, Jim Cowles, the bank’s top ex­ec­u­tive for the re­gion, said at a Dublin con­fer­ence in Jan­uary. The firm has been in dis­cus­sions with BaFin, the Ger­man reg­u­la­tor that’s seen by many as the only reg­u­la­tor out­side of Lon­don ca­pa­ble of han­dling the banks’ com­pli­cated de­riv­a­tives busi­ness, about mov­ing some of its Lon­don-based eq­uity and in­ter­est-rate de­riv­a­tives traders to Frank­furt.

The lender is also in dis­cus­sions with the Euro­pean Cen­tral Bank and reg­u­la­tors in EU na­tions, in­clud­ing Ire­land, about re­lo­cat­ing other parts of its op­er­a­tions.

Frank­furt is a nat­u­ral pick for many in­ter­na­tional firms. Banks are pre­par­ing for the worst and want to have new or ex­panded of­fices up and run­ning inside the bloc be­fore the UK for­mally de­parts in 2019.

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