Lloyds Banking Group chooses Germany for new EU base

Lloyds Banking Group's board is understood to have chosen Germany as its European Union operating base after Brexit and is planning to apply for a banking licence in the country within the next six months.

Lloyds is expected to apply to change the status of its Berlin outpost. Picture: Jane Barlow
Lloyds is expected to apply to change the status of its Berlin outpost. Picture: Jane Barlow

It is believed that group chief executive Antonio Horta-Osorio has decided to turn its Berlin branch into a subsidiary to ensure it has an operating hub inside the EU when the UK leaves the single market.

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The move follows other major British financial institutions making similar moves recently to safeguard their EU access. The three-centuries-old Lloyd’s of London insurance market chose Brussels as the location for its European operations.

Phil Loney, chief executive of life and pensions group Royal London, recently revealed that his the group was in the early stages of turning its existing business in the Republic of Ireland into a legal entity to facilitate business in the EU after the UK’s exit.

Meanwhile, banking group HSBC has said it plans to move 1,000 jobs from London to France after Brexit, the negotiations of which with the EU will take place over the next two years.

Lloyds, which received an all but repaid £20.5bn bailout from the UK taxpayer in the financial crash, is expected to submit an application to BaFin, the German financial regulator, to change the status of its Berlin outpost.

It is thought other jurisdictions considered by Lloyds for an EU-domiciled operation included Dublin and Amsterdam. Lloyds declined to comment.