Dozens of specialist banking jobs have been created in Birmingham as part of a global bank’s plans to shift roles away from the capital but keep them in the country.
Deutsche Bank is to recruit 25 sales trading staff in the region – a rare move as front office roles are rarely switched away from London.
The drive is part of a plan to reduce costs, amid a wider trend of ‘nearshoring’ jobs in banking and insurance to regional cities and towns where salaries are 40 per cent lower. This has already seen the German bank’s workforce in Birmingham swell from 30 in 2006 to 1,300 today.
The move comes at the same time as rumours that Deutsche is seeking to relocate from One Brindleyplace to the larger Five Brindleyplace building, which is being refurbished after the departure of BT.
Deutsche’s fixed-income sales traders in Birmingham will work for institutional clients, adding to a few corporate client-facing staff it transferred last year. It is also considering setting up an equity sales team here.
A spokesman for Deutsche Bank refused to comment on rumours of a move but said: “This is a way we can service those clients that would otherwise not be covered outside of London.
“We’ll start off with fixed income and there’s talk of expanding that to equities in the future. We may expand that to other asset classes. Birmingham has a very strong talent base with all the centrally located universities.”
Deutsche’s Brindleyplace office is dominated by back-office, operations, and private wealth staff and it is understood the new employees will be acting for smaller accounts that can no longer be serviced out of London efficiently. The sales traders will mainly deal with medium-sized clients, allowing Deutsche’s London team to concentrate on larger accounts.
With fixed income trading moving onto electronic platforms, and client communication increasingly done over the phone or via messaging systems, a sales worker’s location has become less relevant.
Eight of the UK’s 10 largest financial centres have lost thousands of financial and professional services jobs over the past three years, according to reports.
Birmingham is the fourth largest of these centres after London, Manchester and Edinburgh and has lost 0.8 per cent or 400 jobs in these sectors since 2008.
The figures, calculated by finance sector industry body TheCityUK from official statistics, show that while the big centres have shrunk, smaller areas have grown.
These include Wolverhampton which has seen a 15 per cent increase or 900 jobs and Coventry which has grown by 11.3 per cent or 1,100 jobs.
The squeeze on financial companies’ profits is forcing them to look hard at costs and moving jobs to the regions can save 40 per cent on the wage bill and property costs up to half that of London.
But the city has proved a draw for other reasons, such as transport links back to London and its diversity.
“What Birmingham is really good at is the middle of the bank – critical areas such as legal and HR,” said Mark Barrow, strategic director of the city council. “Deutsche Bank’s middle-office operations here are a blueprint for this, while a lot of the processing in the sector is still being done offshore.”
Bankers say a key reason for nearshoring in corporate and investment banking is that London has become too expensive for some support functions, but offshoring such jobs is not always the preferred route as it has often not lived up to expectations.
Other global investment banks including Bank of America (BofA), JPMorgan and Deutsche are planning to outsource 3,000 jobs from London to other UK cities and towns over the next few years, due to increasing operational costs.
Employers’ outlook: Page 8
