Citigroup has become the latest big bank to confirm expansion plans in EU cities due to Brexit.
Jim Cowles, Citi’s chief executive for Europe, Middle East and Africa, told staff today that the firm may need to create up to 150 new EU roles.
He said that Frankfurt is the first choice as the new EU headquarters of its broker-dealer business, Citigroup Global Markets, which is currently based in the UK.
And he said Citi is also likely to create more positions in Amsterdam, Dublin, Luxembourg, Madrid and Paris across its private banking, treasury and trade solutions, corporate and investment banking and capital markets divisions.
The US bank currently employs around 6,000 people in the UK, and Cowles added: “In all cases, London will remain both our EMEA headquarters and an important global hub for Citi.”
As we have previously communicated in relation to Brexit, Citi's goal is to ensure continuous and consistent service for our EU and UK clients, while retaining safety and soundness and limiting the impact to our employees and business.
We remain committed to being our clients’ most important and most trusted banking partner, and we have been actively engaged with our clients to discuss their needs and opportunities since the UK referendum more than a year ago.
Overall, we are well positioned for Brexit, with an on-the-ground presence in 20 EU states, and with more than half our current EU workforce already located outside of the UK. As it relates to our banking activities, in January 2016, we substantially expanded our existing Dublin-based European bank, Citibank Europe plc (CEP), which currently employs 46 per cent of our EU staff. CEP will therefore continue to be the vehicle for our banking operations in the EU.
However, if as a result of the Brexit negotiations, the UK loses access to the EU single market, certain adjustments to other parts of our business model will be required.
Our broker-dealer for the EU currently is Citigroup Global Markets Ltd (CGML) which is located in the UK. Assuming the loss of passporting rights to the EU after Brexit, we will continue to operate CGML in the UK market but we will need to develop a new solution for the EU market. Therefore, we plan to convert an existing German subsidiary into an investment firm (broker-dealer). Frankfurt is our first choice for headquartering our EU broker-dealer based on the existing infrastructure, and the people and expertise we already have on the ground.
I believe this is a prudent step to ensure that we will be able to continue to serve our clients throughout the EU from March 2019, regardless of the outcome of the Brexit negotiations. While we will be moving forward with Frankfurt as the headquarters of our EU broker-dealer, we will, of course, continue to monitor future political, legal and regulatory developments that may affect our decisions.
We also expect to further enhance our capabilities in Private Banking, Treasury & Trade Solutions, Corporate & Investment Banking and Capital Markets by increasing over time our footprint in other key EU cities including Amsterdam, Dublin, Luxembourg, Madrid and Paris.
It is not yet possible to assess the outcome or timing of the Brexit negotiations, but in certain circumstances we may need to create approximately 150 new roles located in the EU. In all cases, London will remain both our EMEA headquarters and an important global hub for Citi.
I will continue to share further updates with you regularly. Thank you for your work to support our clients throughout this process.