A Deutsche Bank branch in Frankfurt. Picture:BLOOMBERG
A Deutsche Bank branch in Frankfurt. Picture:BLOOMBERG
Image:

Frankfurt/Zurich — Deutsche Bank envisions shifting almost half its UK positions to the European continent over coming years as the lender’s Brexit plans take shape, people briefed on the matter say.

Most of the 4,000 positions would move to Frankfurt and Berlin under the bank’s base case scenario, the people said, asking not to be identified discussing internal planning. Deutsche Bank would start relocating jobs in 2018 at the earliest, once it had dealt with regulatory approvals and other preparations, another person said.

No plans had been finalised and numbers could still change depending on the UK’s talks with the EU, the people said.

Deutsche Bank’s scenario underscores how executives are increasingly preparing for a hard Brexit, something CEO John Cryan told employees in July.

HSBC Holdings, Europe’s biggest lender, is planning to move about 1,000 roles from the UK, and JPMorgan Chase has said 500 to 1,000 jobs might initially be shifted.

Deutsche Bank’s planned moves are more dramatic, in part because Brexit-related changes dovetail with a new turnaround plan that emphasises its home market in Germany.

"Brexit probably contributes to this shift and makes it more radical," said Michael Huenseler, of Assenagon Asset Management in Munich. "The surprise is that this shift isn’t taking place more gradually."

An official for Deutsche Bank declined to comment.

The bank’s chief regulatory officer, Sylvie Matherat, indicated in April that 4,000 jobs could be at stake in the UK after Brexit, though at the time that number appeared to be a worst case. About 2,000 jobs would be affected if all the bank’s client-facing staff had to move, and an additional 2,000 could be at risk in associated functions, she said at a conference on April 26.

Now the base case, the relocation of 4,000 jobs, threatens to leave the bank’s UK operations greatly diminished.

Deutsche Bank has about 7,000 people in London and about 8,500 across the UK, according to the annual report for 2016.

Across the industry, London could lose 10,000 banking jobs and 20,000 roles in financial services as clients move €1.8-trillion of assets out of the UK after Brexit, according to think-tank Bruegel.

Other estimates have ranged from more than 200,000 jobs to as few as 4,000.

Deutsche Bank is already preparing to move large parts of the trading and investment-banking assets currently on its books in London to Frankfurt as part of its response to Brexit, with people familiar with the matter saying in July that the lender would probably move about €300bn of balance sheet assets out of the UK capital.

Cryan told Bloomberg TV last week that "we genuinely don’t" know what the effect of Brexit would be on the lender’s presence in London.

Sources said that in many cases, Germany’s biggest bank would probably move jobs rather than employees.

In a sign that it is not entirely turning its back on London, Deutsche Bank signed an agreement with Land Securities Group to move its UK headquarters to a building being constructed at 21 Moorfields in the City of London, according to a filing on Tuesday. The lender will lease at least 43,570m² for 25 years if planning approval is secured.

Bloomberg

Please sign in or register to comment.