Sims T. / Davis A. – July 2017
FRANKFURT/LONDON (Reuters) – Morgan Stanley (MS.N) has chosen Frankfurt to be a new base for its European Union operations as Britain prepares to leave the bloc, according to a source familiar with the matter, becoming the latest U.S. bank to pick the German city.
International banks are planning to set up subsidiaries in the EU to ensure they can continue to serve clients if their London operations lose the ability to operate in the EU after Britain leaves in March 2019.
Morgan Stanley is planning to use its Frankfurt subsidiary as the center for its EU trading operations, according to the source.
“That means 200 new people will be coming to Frankfurt,” the source said.
But the bank is likely to spread some of its operations across the EU, with its asset management business expected to go to Dublin. That pattern is likely to be followed by many banks – picking one EU center to be their main regional subsidiary in the bloc but then locating other parts of their businesses in several countries.
A spokesman for Morgan Stanley declined to comment. The news was first reported by the Press Association.
Details of banks’ Brexit arrangements are starting to emerge following a July 14 deadline for them to submit details of their contingency plans to the Bank of England .
Citigroup (C.N) is expected to announce officially this week that it will also be using Frankfurt as its new EU base, while Barclays (BARC.L) said on Friday it was in talks with regulators in Dublin about expanding its operations there.