U.S. investment bank Citigroup Inc. will create a new European trading hub in Frankfurt after Britain leaves the Europe Union, Bloomberg reported on Tuesday.
The plans will be presented to the firm’s board of directors this week, Bloomberg said.
Citigroup already employs around 350 staff in Frankfurt and will add between 150 and 250 new job positions to the new hub.
The jobs will be filled by transferring staff in London, hiring locally, or a combination of both.
Although London will remain Citigroup’s regional headquarters for Europe, the Middle East and Africa, the decision marks another instance of Frankfurt attracting new business after Britain voted to leave the EU last year.
Financial institutions based in Britain have repeatedly voiced concerns that Brexit will make them lose access to the EU’s single market.
Citigroup has been mulling the shift in trading activities for several months, evaluating potential moves to Ireland, Spain, Italy, Germany, France and the Netherlands.
It remains in discussions with the European Central Bank and regulators within the EU as it considers relocating additional operations from London.
EU officials and European heads of state have emphasized that London would have to abide by the jurisdiction of the European Court of Justice, accept the freedom of movement and continue to pay into EU budgets in order to preserve banks’ current “passporting” rights which allow them to serve clients seamlessly across the bloc.
British Prime Minister Theresa May has ruled out such a close bilateral relationship with the EU, leading senior business representatives to complain that the country was heading towards a harmful “Hard Brexit” which prioritizes lowering migration over the needs of the economy.
The British financial services lobby group TheCityUK estimates that 70,000 jobs could be lost in the industry if Britain does not remain in the single market, while London Stock Exchange chief Xavier Rolet put the figure as high as 270,000 in the event of a loss of euro-clearing activities.
So far, Frankfurt appears to have emerged as the victor amongst European cities vying for financial services business from London. The lobby group Frankfurt Main Finance reported that as many as 20 banking institutions are considering expanding or creating new corporate entities in the city.
Major global lenders including Goldman Sachs, Deutsche Bank and UBS, as well as the Japanese banks Nomura, Daiwa and Sumitomo Mitsubishi Financial Group have announced plans to open new offices in Frankfurt.
According to Bloomberg data, the German city leads the race for staff moves from London with around 2,600 confirmed relocations, ahead of Paris which will receive 1,400 staff relocations.
Frankfurt is home to three major regulatory bodies, the European Central Bank, German Central Bank and German Federal Financial Supervisory Authority, giving it an advantage over continental rivals.