50 Banks Have Discussed Brexit Moves With Supervisors

Daniele Nouy, head of supervision at the European Central Bank, said about 50 banks have discussed their Brexit business-relocation plans with authorities in the European Union.

Nouy said in Frankfurt on Tuesday that license applications from about 20 banks are in some stage of assessment by supervisors on the continent. “Maybe they have not signed the formal requirement,” she said, but they have made a “pretty comprehensive application that can be turned into a formal one very, very fast.”

International banks are working on plans to shift workers from the U.K. to the continent after Brexit to maintain access to the single market. Chief Executive Officer Sergio Ermotti has said UBS Group AG will start the process of moving London-based employees to expanded offices inside the EU early next year.

Frankfurt, home of the ECB, has emerged as a destination of choice. JPMorgan Chase & Co. is nearing a deal to lease additional office space while Citigroup Inc. and Deutsche Bank AG are scouting the market for options, according to people with knowledge of the matter. Goldman Sachs Group Inc. has already signed leases for offices that they won’t move into until 2019.

“There is an enormous interest in the international banking sector to have Frankfurt as an operation basis in addition to what they have in Europe and other countries for the time being,” Peter Altmaier, Germany’s acting finance minister, said in Brussels. “And they will find open doors. They will find qualified people. They will find conditions to work and to relax that are above average.”

The U.K. could lose as many as 75,000 jobs in banking and insurance if it leaves the EU without a trade deal, according to Sam Woods, Britain’s top banking regulator. About 10,000 U.K.-based jobs are probably at risk on “day one” of Brexit, said Woods, chief executive officer of the Bank of England’s Prudential Regulation Authority.

Nouy said some banks have discussed their Brexit plans with euro-area supervisors several times. “They are improving their understanding of the situation,” she said.

Source: Bloomberg