| DePfa moves public sector bank to Ireland |
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| DePfa-Bank Europe to become headquarters for public sector bank in anticipation of the introduction of pfandbrief legislation in Ireland, due next year. |
Wholesale, IFSC bank DePfa-Bank Europe will become the centre for its German parent’s public sector finance bank by 2002. DePfa plans to split its business ito a public sector finance bank, to be run from Dublin and a property bank, which will be run from Germany.
The move has been seen a vote of confidence in Ireland and its regulation system, but the company were keen to stress that business is not being taken away from Germany.
DePfa-Bank Europe, based in Dublin’s docklands, holds a full banking license and will become the holding company and headquarters for the group’s public sector bank.
All of DePfa’s public sector financing operations will be run from the Dublin location, and the move was described as a ‘logical next step’ by chairman of DePfa-Bank Europe Gerhard Bruckermann. Dublin already writes all of the non-German public sector financing business for the Group he said. The Dublin operation is expected to manage about 50 per cent of the group’s capital, when this goes ahead by 2002. Half year figures show that the public sector finance section of the business was worth E17.6 billion as at September 30th 2000.
Under the plans, the German parent group is preparing to split its public sector finance and property businesses into two separate divisions by 2002, as an interim step to becoming two completely independent banks.
The move to base this part of the bank in Ireland is linked to the proposed Irish ‘Pfandbrief’ project which would allow the issuance of ‘Pfandbrief’ bonds by banks in Ireland. Legislation for this is expected to be introduced next year.
DePfa-Bank Europe managing director, Dermot Cahillane, said that the plan to headquarter the public finance bank in Ireland was directly linked to this project but not dependent on it being approved. But he added that Irish pfandbrief would be a ‘natural refinancing product’ for the company.
While the running of the public sector bank from Dublin would mean a natural expansion of activities in Ireland, Cahillane said that there would not be a dramatic increase in employees in Ireland as international staff will be coordinated from Dublin. The Irish operation currently employs over 60 people and is expected to manage 250 globally when the deal is finalised. The business also has operations in New York, Tokyo and London as well as in most European capitals.
The less profitable property bank will be parented by DePfa Bank AG and run from Germany, but there is expected to be some sell off of unprofitable operations. The activities of the property bank will focus mainly on professional property clients. |
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| Article appeared in the December 2000 issue.
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