* Bank in talks with regulators about setting up subsidiary
* Chairman says unlikely to see material impact from Brexit
* Lender looking to resume dividends as soon as possible
(Adds quotes from StanChart Germany head)
By Lawrence White
LONDON, May 3 Standard Chartered is in
talks with regulators about making Frankfurt its European base
to secure market access to the European Union when Britain
leaves the bloc.
"We are looking at setting up a subsidiary in the EU to
ensure we are prepared," Chairman Jose Vinals said on Wednesday
at the Asia-focused bank's annual shareholder meeting in London.
"The choice of Frankfurt is very natural as we have a branch
there and we do euro clearing there," he said.
London-based banks are expected to announce more concrete
plans over the next two months for how they will ensure that
they can continue serving customers as Britain prepares to
negotiate its EU departure.
Financial services firms need a regulated subsidiary in an
EU country to offer their products across the bloc if Britain no
longer has access to the European single market.
Bankers say Frankfurt is set to win the most business
following a discreet but concerted campaign to promote the
financial centre of Europe's biggest economy.
Standard Chartered Germany head Heinz Hilger told Reuters
the bank will set up a European subsidiary in Frankfurt and
apply for a full banking licence, allowing it to continue to
carry out its business once passporting from the UK will become
"We currently have about 100 staff in Frankfurt and office
space capacity to add another 20," he said.
Building a new European hub will be a step-by-step process
and it was not yet possible to say how many employees the bank
will have in Frankfurt in the end - which will be dependent on
whether Brexit will be hard or soft, he added.
While the tasks of the bank's individual European branches
will not change, Frankfurt will add some functions including
acting as an information hub and maintaining contact with the
banking regulator, he said.
A company spokesman added that Standard Chartered will hire
a small number of staff locally and the impact on UK staff would
Vinals, in his first appearance in front of shareholders
since being appointed chairman, said Standard Chartered is
unlikely to see a material impact from Brexit.
He said the board had decided it was the bank's best
interest not to declare an ordinary divided for 2016, but said
it is committed to resuming dividends as soon as possible.
The bank halted its dividend in 2015 to bolster its balance
sheet, under a plan to restore profitability after three years
of falling profit and strategic missteps.
(Additional reporting by Arno Schuetze; writing by Andrew
MacAskill; editing by Alexander Smith and David Evans)