Lloyds Banking Group (LON:LLOY) has chosen Germany as its European base after Brexit, The Telegraph has reported. The move will come as UK lenders are forced to set up new bases on the Continent with the country set to leave the European Union’s single market.
Lloyds’ share price has slipped into the red in today’s session, having shed 0.41 percent to 62.46p as of 08:17 BST, largely in line with losses in the broader London market, with the benchmark FTSE 100 index currently 0.50 percent worse off at 7,290.74 points. The group’s shares have lost more than eight percent of their value over the past year, but are up by 0.4 percent in the year-to-date.
The Telegraph reported over the weekend that Lloyds was understood to have made a final decision to turn its Berlin branch into a subsidiary, to ensure that it has a hub inside the EU once the UK leaves the bloc. The bank hopes to submit an application to Germany’s financial regulator BaFin to change the status of its Berlin operation by the end of September.
While the bailed-out lender reportedly considered a number of EU cities for a base, including Amsterdam and Dublin, it settled on Germany’s capital with the city already home to its biggest European operation, employing some 300 staff. Converting Berlin to a subsidiary is expected to only require Lloyds to add a small number of staff to the city.
The 21 analysts offering 12-month price targets for Lloyds for the Financial Times have a median target of 76.00p, with a high estimate of 100.00p and a low estimate of 40.00p. As of April 14, the consensus forecast amongst 28 polled investment analysts covering the blue-chip bank has it that the company will outperform the market.