| Story Views | |
| Now: | |
| Last Hour: | |
| Last 24 Hours: | |
| Total: | |
Deutsche Bank signals confidence in post-Brexit Britain by securing new London headquarters
Deutsche Bank (NYSE:DB) is in discussions with Land Securities Group plc (LON:LAND) to move its headquarters to a new address in London, signalling a vote of confidence in a post-Brexit Britain.
In a statement today, Land Securities confirmed it is in talks with the bank regarding a pre-let agreement for its development at 21 Moorfields in Moorgate. The building is currently under construction.
The property developer said it will shortly complete demolition of existing buildings before constructing a raft above the nearby station, which will be finished by June 2018.
Deutsche Bank’s decision to stick around London emerged yesterday after an internal memo was sent to staff about moving its headquarters from Winchester House.
The German bank has reportedly agreed a 25-year lease for the building with Land Securities after the lease at its current headquarters expires in 2023.
“The move underlines the bank’s commitment to the City of London and the importance it attaches to being an employer of choice in the capital,” the memo from Deutsche Bank’s chief Garth Ritchie said, according to the Telegraph, which read the note.
“It will advance the bank’s strategic goals of increasing efficiency, reducing complexity and strengthening links between the business divisions and infrastructure functions.”
Ritchie said the new office will be near the new Crossrail link, which will be beneficial to travel for staff.
Deutsche Bank is looking to cull back the number of leases its holds, with 15 buildings currently in London.
The bank is trying to cut back on its expenses after receiving a series of fines for misconduct 0ver the years. In January the company was fined more than £500mln by British and US authorities for inadequate anti-money laundering controls.
Earlier this week it revealed it had cut its bonus pool by 77% to €500mln to prop up its balance sheet.
Deutsche Bank’s decision comes in contrast to Goldman Sachs, which on Tuesday confirmed jobs will be moved out of London and hundreds of roles will be added across Europe following Brexit.
Other banks that have also warned that roles will have to go as a result of Brexit include HSBC, UBS and JP Morgan.
HSBC chief executive Stuart Gulliver has said 1,000 roles will move to Paris in about two years while UBS has said 1,000 of its 5,000 staff could relocate, possibly to Frankfurt or Madrid. JP Morgan has said 4,000 UK jobs are at risk.
The government will trigger Article 50 on 29 March, which will kick off the formal process for the UK’s exit from the European Union.
As Brexit looms, the European Central Bank is said to have received several inquiries from British lenders wanting to move to the EU, the Independent reported on Wednesday, citing sources.
In the ECB’s annual report yesterday, the central bank warned that banks will need to boost their profitability amid geopolitical uncertainty, including Brexit.
“(Banks) have become much more resilient over the past few years; their capital buffers have increased significantly,” Danièle Nouy, chair of the Supervisory Board at the ECB, said in the report.
However, she said they still face risks and challenges.
“Besides having to work out how they can raise profits in a challenging environment, how they can dispose of legacy assets and how they should deal with cybercrime and other IT risks, they currently face a number of other questions. Will competition from non-banks intensify? Where is the euro area economy headed? How will Brexit affect banks in the euro area? How will other geopolitical issues play out?,” she added.
Bank of England Governor Mark Carney has said if UK banks move elsewhere because of Brexit, it could see Britain’s financial services sector fall apart like a wobbly wooden tower in the popular game of Jenga. He said he agreed with remarks made by the chairman of HSBC, who compared London with Jenga, which involves players removing pieces from a wooden tower and trying to avoid it from collapsing.
“I think just like when you play Jenga and you start early on, there are some pretty obvious pieces you can take out without imperilling the tower,” Carney said in January.
Story by ProactiveInvestors
Source: http://www.proactiveinvestors.com/companies/news/175349/deutsche-bank-signals-confidence-in-post-brexit-britain-by-securing-new-london-headquarters-175349.html
