Deutsche Bank shows faith in post-Brexit City with new HQ plan

(c) Sky News 2017: <a href="http://news.sky.com/story/deutsche-bank-shows-faith-in-post-brexit-city-with-new-hq-plan-10811705">Deutsche Bank shows faith in post-Brexit City with new HQ plan</a>
 

One of the City's biggest employers is ‎demonstrating its confidence in London's post-Brexit future as a financial centre with a 25-year deal for a new UK headquarters.

Sky News has learnt that Deutsche Bank (IOB: 0H7D.IL - news) has signed an agreement with Land Securities (LSE: LAND.L - news) , the FTSE-100 property company, to‎ take a large chunk of a new building being constructed near Moorgate tube station.

The move by Deutsche was announced on its staff intranet by Garth Ritchie‎, the bank's UK chief executive and head of its corporate and investment bank, on Thursday afternoon.

It comes just days after Goldman Sachs (NYSE: GS-PB - news) cast doubt over the scale of its future London presence by saying that it was preparing to activate plans to increase its employment base elsewhere in Europe following last year's referendum result.

Mr Ritchie's memo is likely to be hailed by ministers as evidence that London will continue to thr‎ive as a financial centre even as rival cities such as Frankfurt - where Deutsche Bank is headquartered - attempt to poach business from it.

Deutsche, which has endured a torrid last 12 months and this week confirmed plans to raise billions of Euros by selling new shares to investors, employs 7,000 people in London and a further 2,000 elsewhere in the UK.

In his note, Mr Ritchie said the decision to take a 25-year lease on the building at 21 Moorfields "underlines the bank's commitment to the City of London (LSE: CIN.L - news) ‎ and the importance it attaches to being an employer of choice in the capital".

In the wake of the Brexit vote, Deutsche's chief executive, John Cryan, said the German lender was "disappointed" at the outcome but added that it did "not believe significant changes will be required to our current UK structure or business model in the short term as a result of the referendum".

Mr Ritchie said in his note on Thursday that the move to the new UK headquarters would "advance the bank's strategic goals of increasing efficiency, reducing complexity and strengthening links between the business divisions and infrastructure functions".

He did not say in the memo how many Deutsche Bank staff would be based in the new building.

Other big City employers, including Barclays (LSE: BARC.L - news) , Citi,‎ and UBS (LSE: 0QNR.L - news) have signalled that some jobs are likely to be relocated because of Brexit, with many plans expected to be accelerated after Theresa May triggers the Article 50 process next week.

International banks have used their UK operations to 'passport' into other EU member states, a capability which will no longer be available to them when Britain is outside the single market.

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