US bank Citi is expected to confirm this week it is the latest financial giant to up sticks and move a major part of its operation out of a post-Brexit Britain.
The bank, which employs about 9,000 people in the UK, is believed to have chosen Frankfurt as its European base for a second broker-dealer.
Citi is reported to have chosen the German city ahead of Paris as its hub for sales and trading in the EU, currently carried out in London. Sources said the move would involve “a couple of hundred” jobs outside of London after Brexit.
It will be a further blow to London as a financial centre and another kick to Prime Minister Theresa May and Brexit secretary David Davis.
Global banks have said they could move thousands of jobs out of Britain to prepare for the country’s planned EU exit.
Barclays, JP Morgan, HSBC and UBS have talked in recent weeks about stepping up their plans to move operations and people out of the UK post-Brexit. Deutsche Bank, BNP Paribas and Bank of America Corp are also contemplating shifting some operations after Brexit, with Dublin among the frontrunners.
Goldman Sachs, Morgan Stanley and the Japanese firms Daiwa Securities and Nomura are among the other firms to have already indicated Frankfurt as a preferred base once the UK formally leaves the EU.
The Association of Foreign Banks in Germany expects 3,000 to 5,000 new jobs in Frankfurt over the next two years as a result of Brexit, its head Stefan Winter of UBS told Welt am Sonntag in June.
Financial services firms need a regulated subsidiary in an EU country to offer products across the bloc, which could prompt some to move jobs out of Britain if it loses access to the European single market.
Brussels is already agitating to move the multi-trillion euro clearing market out of London and across the Channel into the EU.