Deutsche Bank has moved a “large part” of its euro clearing activity to Frankfurt from London in a boost to the efforts of the eurozone’s top financial centre to lure business away from the City before Brexit.  Germany’s biggest bank has reportedly said its decision would not affect jobs because it would simply involve pushing a different button to route clearing to Eurex, the clearing division of the German exchange Deutsche Börse.

I agree with most analysts that the move is, for the most part, symbolic–but for reasons beyond the relatively small share of the market that Deutsche Bank represents (8%).  Overall, the German government has been extremely vocal about the relocation of clearing infrastructure, and with Deutsche Bank’s own strategic retreat from the United States back to Europe, it should be hardly surprising that clearing would take on a similar pattern, especially given the outsized influence the German government will now wield over the bank.  Few other international banks are in this particular position.  And whether other EU governments (outside of maybe France) will make similar pushes for locally based banks remains to be seen.

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