Goldman Sachs has put into action the first phase of its Brexit contingency plans by telling senior bankers based in London that they will be moving to Frankfurt in June.

Brexit and the issue of ‘passporting rights’

Amid fears that, after Brexit, the UK will lose the ‘passporting rights’ that currently enable City financial firms to operate freely throughout the EU, many banks have been busy setting up hubs in other European cities, but the US bank is believed to be the first to actually start moving staff.Joerg Kukies, joint CEO of Goldman Sachs in Germany, told a conference in Frankfurt on Wednesday, “We’re starting to build infrastructure by making transfers and moving senior people to Frankfurt. The two cities we are looking at the most are Frankfurt and Paris.” Mr Kukies declined to say how many staff would be moved but a report in The Independent newspaper suggested a dozen or more banking, trading and sales staff would be involved in the initial relocation, which is being seen as a trial run for more to come.Aside from Frankfurt and Paris, some staff are also likely to be moved to existing offices in Milan, Madrid and Dublin as part of a strategy which not only reflects Brexit concerns but Goldman Sachs’ strategy to increase its presence throughout Europe.

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Goldman Sachs’ Frankfurt workforce

The Wall Street bank currently employs about 6,500 staff in the UK and the bulk of these are expected to remain in Britain. However, Goldman Sachs plans to double its 400-strong Frankfurt workforce through both relocations and local hires and has also signed a lease on new office space being built in the city.“After months of patience and private lobbying, the US investment bank has decided it can no longer wait for clarity from MPs on how its business might be impacted by Britain’s exit from the trading bloc and is taking the steps to minimise disruption to clients,” reported The Independent.“It has informed members of its London-based derivatives and debt capital markets teams working on German accounts that their activities will be relocated to its base in Frankfurt and to make the necessary preparations to move to those offices by end-June.“Goldman’s decision to reissue some staff contracts and set a timeline to move teams to the continent marks one of the first tangible signs that banks are starting to execute on Brexit contingency plans after Prime Minister Theresa May ruled out retaining passporting rights for financial services.”

Other Brexit relocations being triggered

Last month, Credit Suisse revealed it was planning to move about 250 of its 5,500 London banking jobs in the first phase its Brexit contingency plans. Bloomberg reported employees in areas such as trading and mergers and acquisitions were likely to be relocated to Frankfurt or Madrid, after a move to Paris was rejected after talks with French regulators.Meanwhile, Deutsche Bank has confirmed it will move an unspecified number of jobs to Frankfurt, Milan and Paris, and the European Bank for Reconstruction and Development said this week that more than 10 countries had offered to host a new office should it decide to move some of its 1,500 London staff. 

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Read more about the future of the UK industry in the Winter issue of our magazine 

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For related news and features, visit our Brexit section.  Relocate’s new Global Mobility Toolkit provides free information, practical advice and support for HR, global mobility managers and global teams operating overseas.Access hundreds of global services and suppliers in our Online Directory

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