UBS picks Frankfurt as hub

SINGAPORE: UBS Group AG has picked Frankfurt as its postBrexit European Union (EU) hub and has made preparations for the worst-case scenario of Britain crashing out of the bloc without a deal, chief executive officer Sergio Ermotti said.

The Swiss bank made the decision a few weeks ago, Ermotti said in a Bloomberg Television interview here yesterday.

While Germany’s financial centre will be the base, UBS will employ a multi-location strategy in the region, he said, naming offices in Madrid, Paris and Milan.

“The financial system is already operating on the assumption that there is no agreement,” between the United Kingdom and EU, said Ermotti.

“Whatever is going to happen from now onwards, it’s not going to make the exercise less expensive.”

UBS has previously said it’s facing a bill of more than 100 million francs (RM429.12 million) because of Brexit, including the cost of relocating staff from the City of London and legal bills.

EU regulators have made it clear they expect banks to establish fullscale, standalone operations within the 27 remaining member states as soon as possible.

Ermotti said the impact of Britain’s decision to leave the EU has already been felt, with companies pulling back across the continent.