Lloyds Banking Group PLC has secured a banking license for its new Berlin-based subsidiary as part of its plans to protect its business as the U.K.'s departure from the EU draws closer, Reuters reported, citing a source familiar with the matter.
The bank's current Berlin office employs around 300 staff, serving its retail and corporate banking business, the Jan. 17 report said. Lloyds had also applied for licenses in Frankfurt and Luxembourg, but those applications remain outstanding, the source said, adding that full regulatory approvals are expected to be obtained by March 29.
The Berlin office would have to be recapitalized in the amount in the low hundreds of millions of pounds in order to become a full unit, as it currently runs on the so-called passporting rights, which U.K.-domiciled companies are bound to lose due to Brexit, the newswire wrote.
Royal Bank of Scotland Group PLC is also stepping up efforts to secure a German license, with Chairman Howard Davies reportedly meeting with the country's financial regulator BaFin on Jan. 15, Reuters added.