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Expansion in Frankfurt

RBS seeks German banking licence for Brexit trade

RBS Gogarburn

RBS is making moves to protect its European business (pic: Terry Murden)


Royal Bank of Scotland has applied for a German banking licence to help retain access to clients in the European Union after Britain withdraws from the bloc next March.

The move will allow RBS to maintain systems linked to the Bundesbank, the German central bank,  and continue to benefit from passporting rights that give financial services firms cross-border access to EU clients.

It applies to all its subsidiaries, but would only affect NatWest, which trades across the bloc.

RBS will upgrade its current branch in Frankfurt with a new licensed unit and add about a dozen jobs. There will be no significant impact on its UK operations.

The new hub will be responsible for processing and settling euro-denominated payments, managing euro liquidity and offering loans to large German companies.

RBS already has a banking licence in the Netherlands due to its 2007 takeover of Dutch lender ABN Amro and has announced plans to beef up its presence in Amsterdam. It will move £13 billion worth of business to the Netherlands in the event of a disorderly Brexit.

About 30% of the customers for its investment banking unit, NatWest Markets, will move to the lender’s new Dutch subsidiary by 4 March.

Banks and other financial services firm are expanding or setting up hubs in the EU cities in response to Brexit. Lloyds Banking Group is to set up three subsidiaries in Berlin, Frankfurt and Luxembourg, while Barclays is expanding its Dublin office.

German lobby group Frankfurt Main Finance previously said that €800bn (£711bn) of assets are to move to Frankfurt.

It said 30 out of 37 financial institutions which have applied to the European Central Bank for new licences, or to extend existing ones, have chosen the German financial centre for their European headquarters.


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