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Abu Dhabi, UAESaturday 23 June 2018

Global investment banks step up pre-Brexit hires in Frankfurt

Goldman Sachs, JP Morgan and Morgan Stanley are advertising scores of jobs 

The late winter light shines on the buildings in the City of London. Job openings in the UK capital’s finance industry fell 52 per cent in December, the most in three years, according to Morgan McKinley. Simon Dawson / Reuters
The late winter light shines on the buildings in the City of London. Job openings in the UK capital’s finance industry fell 52 per cent in December, the most in three years, according to Morgan McKinley. Simon Dawson / Reuters

Goldman Sachs Group, JPMorgan Chase and Morgan Stanley are on a hiring drive in Frankfurt as global investment banks race to establish new headquarters inside the European Union in time for Brexit.

The biggest Wall Street firms have recently started advertising for scores of staff ranging from risk managers to compliance officers and information-technology specialists, according to internet listings. They need their offices to be up and running by April 2019, headhunters and people familiar with their firm’s hiring plans said.

Banks want to fill as many positions as they can locally to limit the disruption caused by relocating London-based employees and their families, said the people, who asked not to be identified as the plans aren’t public. With only about 14 months to go until Britain formally departs the EU, banks have reached what one executive called the point of no return, and have decided they need to trigger their contingency plans.

“Many banks are hiring now to meet at least the minimum staffing requirements" by the time Brexit happens, said Tim Zuehlke, a partner at FRED Executive Search.

Regardless of whether the UK can reach a two-year transition arrangement, EU regulators have made it clear they expect banks to establish full-scale, standalone operations inside the trading bloc staffed by significant numbers of both front- and back-office staff as well as senior employees, rather than so-called brass-plate offices with people commuting from London.

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Read more:

London finance jobs post ‘seismic’ drop in sign of Brexit impact

UK growth to remain weak in 2018 as Brexit uncertainty weighs

EU risks another financial crisis with a hard Brexit deal for banks

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Goldman Sachs plans to more than double its staff in Frankfurt to 400. The bank has already hired about half a dozen people locally, one of the people said, and is advertising for a further 10 vacancies on its website. Morgan Stanley intends to add about 200 roles in Germany’s financial capital. The bank is currently advertising vacancies for 17 positions in Frankfurt, including a "liquidity risk manager."

US investment banks "are intensifying recruitment for back office in Frankfurt," said Aleksandar Rakovic, head of banking for the headhunting firm Robert Walters. "Pay in those areas will continue to rise."

Given the scarcity of experienced bankers in Frankfurt - there are 60,000 people working in finance in the city, compared with more than 360,000 in London - firms are hoping that any shortfall will be met by German expatriates keen to return home, the people said. Given the likelihood of relocations by people of other nationalities, banks have already started block-booking places at international schools and leasing apartments in anticipation of a squeeze on local resources, they said.

As many as 10,000 new jobs may be created in the German city in the next few years, according to the lobby group Frankfurt Main Finance. By contrast, job openings in the UK capital’s finance industry fell 52 per cent in December, the most in three years, recruitment firm Morgan McKinley said on Thursday.