LONDON FRANKFURT BRIDGE
WELCOME TO FRANKFURT
MINISTRY OF ECONOMICS, ENERGY, TRANSPORT AND REGIONAL DEVELOPMENT,
STATE OF HESSEN
TAREK AL-WAZIRMINISTER OF ECONOMICS, ENERGY,
TRANSPORT AND REGIONAL DEVELOPMENT
MINISTRY OF ECONOMICS, ENERGY,
TRANSPORT AND REGIONAL DEVELOPMENT,
STATE OF HESSEN
DR. BERNADETTE WEYLANDSTATE SECRETARY OF FINANCE
MINISTRY OF FINANCE,
STATE OF HESSEN
LONDON FRANKFURT BRIDGE
THE NEW ARCHITECTURE
10 / 11 AUGUST 2016
LONDON FRANKFURT BRIDGE
I. SOUND ASSUMPTIONS
LONDON FRANKFURT BRIDGE
I. SOUND ASSUMPTIONS
WHAT WILL BE THE MOST PROBABLE FUTURE STATUS FOR THE UK REGARDING THE EU?
less probableless probable
less probable
EUROPEAN ECONOMIC AREA
(EEA-MODEL)
Continued Single Market Access :
PRIVILEGED THIRD COUNTRY ACCESS
Customs Union:
WTO / GATS FRAMEWORK:
EUROPEAN FREE TRADE ASSOCIATION
(EFTA)
FRAMEWORK:
MINISTRY OF ECONOMICS, ENERGY, TRANSPORT AND REGIONAL DEVELOPMENT, STATE OF HESSEN PAGE 5
most probably
XXX
XXX
II. EU EXIT:
RISKS, EFFECTS AND STRATEGIC CHANGES
MINISTRY OF ECONOMICS, ENERGY, TRANSPORT AND REGIONAL DEVELOPMENT, STATE OF HESSEN, PAGE 7
II. EU EXIT:
EXIT RISKS AND PROBLEMATIC ASPECTS
CHANGES:
EU Passporting Rights
Euro Clearing
Extra Capital Requirements
Additional and costly regulatory environment UK vs. EU
AFFECTED BUSINESSES:
Investment Banking
Listing
Trading
Lending
Deposit taking
Payments
Regulatory and Risk Management
Legal
MINISTRY OF ECONOMICS, ENERGY, TRANSPORT AND REGIONAL DEVELOPMENT, STATE OF HESSEN PAGE 7
LONDON, 10 AUGUST 2016 PAGE 8
II. EU EXIT:
STRATEGIC REQUIREMENTS
London needs a continental partner to remain a financial Bridge to the EU
LONDON, 10 / 11 AUGUST 2016
MINISTRY OF ECONOMICS, ENERGY, TRANSPORT AND REGIONAL DEVELOPMENT, STATE OF HESSEN PAGE 9MINISTRY OF ECONOMICS, ENERGY, TRANSPORT AND REGIONAL DEVELOPMENT, STATE OF HESSEN PAGE 9
LONDON FRANKFURT BRIDGE
THE NEW ARCHITECTURE
XXX
XXX
10 POINTS IN FAVOUR OF FRANKFURT AS PILLAR OF THE
BRIDGE
III. FRANKFURT BEST SUITED:
MINISTRY OF ECONOMICS, ENERGY, TRANSPORT AND REGIONAL DEVELOPMENT, STATE OF HESSEN, PAGE 11
III. FRANKFURT BEST SUITED:
1. INTERNATIONAL FINANCIAL CENTER
Every major bank or financial services institution is already here
_ More than 155 foreign banks _ All major German banks
Financial capital market services with Frankfurts securities and derivatives exchanges
Broad offer of other financial service related services (legal, consulting, analyst)
MINISTRY OF ECONOMICS, ENERGY, TRANSPORT AND REGIONAL DEVELOPMENT, STATE OF HESSEN PAGE 11
2. PROXIMITY TO REGULATORSIII. FRANKFURT BEST SUITED:
III. FRANKFURT BEST SUITED:
2. PROXIMITY TO REGULATORS
Your regulators are also already there:
ECB
ESRB
EIOPA FMSA GLEIFGerman Federal Bank
BaFin
MINISTRY OF ECONOMICS, ENERGY, TRANSPORT AND REGIONAL DEVELOPMENT, STATE OF HESSEN PAGE 13
3. REGULATION – 1-STOP-SHOPIII. FRANKFURT BEST SUITED:
YOU ARE WELCOME!
III. FRANKFURT BEST SUITED:
3. REGULATION – 1-STOP-SHOP
BaFin offers single point of entry:
Predictable
Reliable
MINISTRY OF ECONOMICS, ENERGY, TRANSPORT AND REGIONAL DEVELOPMENT, STATE OF HESSEN PAGE 15
4. TAXESIII. FRANKFURT BEST SUITED:
III. FRANKFURT BEST SUITED:
4. TAXES
Overall tax levels are way lower than commonly presumed:
Effective tax rates in 2014:
BUSINESS TAX
10 -16 %
30,4 %
TOTAL
25 - 31 %
29,6 % 27,9 %
CORPORATE TAX
15 %
38,2 %
FRANCE GERMANY LUXEMBOURG UNITED KINGDOM
MINISTRY OF ECONOMICS, ENERGY, TRANSPORT AND REGIONAL DEVELOPMENT, STATE OF HESSEN PAGE 17
5. LABOUR LAWIII. FRANKFURT BEST SUITED:
III. FRANKFURT BEST SUITED:
5. LABOUR LAW
German labour law is highly fl exible and effective
66 % of disputes are resolved within three months
Redundancy payments are regulated by law: In practice, payments of between 0.5 and 2 salaries per year of employment are the norm
A study by the Federal Statistical Offi ce found the number of actions fi led involving labour law in 2011 (three years after the fi nancial crisis) was only 60 % of the 1995 level
MINISTRY OF ECONOMICS, ENERGY, TRANSPORT AND REGIONAL DEVELOPMENT, STATE OF HESSEN PAGE 19
6. GERMAN ECONOMYIII. FRANKFURT BEST SUITED:
III. FRANKFURT BEST SUITED:
6. GERMAN ECONOMY
Very stable German economy offers growing business opportunities
Bank will benefit from very reliable clients
Political stability
Top rating from Single Resolution Mechanism
Top ranked in ease-of-doing-business-index (rank 15)
_ Rankings of other prominent European countries:
_ Ireland (17) _ France (27) _ Netherlands (28)
MINISTRY OF ECONOMICS, ENERGY, TRANSPORT AND REGIONAL DEVELOPMENT, STATE OF HESSEN PAGE 21
7. FRANKFURT RHEINMAIN AREA
III. FRANKFURT BEST SUITED:
III. FRANKFURT BEST SUITED:
7. FRANKFURT RHEINMAIN AREA
Highly international workforce + communities: english broadly spoken
5.6 million inhabitants
High GDP: 216 Billion € + persistant growthNo. 2 in EU regarding the regional GDP per capita
Outstanding infrastructure (Frankfurt Airport)
Internet-Hub No. 1 in EU (plus IT-Cluster)
Frankfurt RheinMain & Neckar region:Europe’s Silicon Valley
Top universitiesStartups (360T, “Rhein-Main Startups”)
World market leaders (SAP)
MINISTRY OF ECONOMICS, ENERGY, TRANSPORT AND REGIONAL DEVELOPMENT, STATE OF HESSEN PAGE 23
8. BEST BUSINESS ENVIRONMENTIII. FRANKFURT BEST SUITED:
III. FRANKFURT BEST SUITED:
8. BEST BUSINESS ENVIRONMENT
Expenses low for companies and employees
Wages adequate Schools affordable: many international schools
available
Excellent public schools and kindergartens
Health care affordable+ high quality
MINISTRY OF ECONOMICS, ENERGY, TRANSPORT AND REGIONAL DEVELOPMENT, STATE OF HESSEN PAGE 25
9. HIGH QUALITY OF LIFEIII. FRANKFURT BEST SUITED:
Top museums, art
Vivid cultural scene
Price winning opera “Oper Frankfurt” (2014 & 2015)
English Theatre Frankfurt
Many local recreational areas:
_ Taunus Forest _ Rheingau Rhine Valley _ Parks _ Vineyards
Excellent work-life-balance
Short distances for work and transportation
III. FRANKFURT BEST SUITED:
9. HIGH QUALITY OF LIFE
MINISTRY OF ECONOMICS, ENERGY, TRANSPORT AND REGIONAL DEVELOPMENT, STATE OF HESSEN PAGE 27
10. FRANKFURT PLACE TO GOIII. FRANKFURT BEST SUITED:
III. FRANKFURT BEST SUITED:
10. FRANKFURT PLACE TO GO
Frankfurt recommended by:
BCG-Study 06 / 2016
_ Frankfurt best choice with regard to economical and political stability, high qualifi ed employees and taxes
StepStone Study 07 / 2016
_ 44 % of professionals and executives prefer Frankfurt as place of work
Center for Financial Studies 07 / 2016
_ Winning areas: “securities trading and settlement”, “corporate banking” and “asset management” (Bloomberg: “Frankfurt Trading to Grow in Importance Post-Brexit, Study Finds”)
24 %Ireland
29 %Spain
30 %France
44%Germany
26%Netherlands
around 600.000 british citizens want to change their jobs
MINISTRY OF ECONOMICS, ENERGY, TRANSPORT AND REGIONAL DEVELOPMENT, STATE OF HESSEN PAGE 29
FRANKFURT PLACE TO BE
III. FRANKFURT BEST SUITED:
FRANKFURT PLACE TO BE
International fi nancial center
Proximity to regulators
Regulation – 1-stop-shop
Taxes
Labour law
German economy
Frankfurt RheinMain area
Best business environment
High quality of life
Frankfurt place to go
MINISTRY OF ECONOMICS, ENERGY, TRANSPORT AND REGIONAL DEVELOPMENT, STATE OF HESSEN PAGE 31
LONDON, 10 AUGUST 2016 PAGE 32
Ministry of Economics, Energy, Transport and Regional Development,State of Hessen
Hessen Trade & Invest GmbH
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