U.S. Citi surrenders its sovereignty to European Central Bank
This is an option several UK-based companies are exploring to keep their access to the single market.
Banks are looking for ways to ensure they can easily sell their services into the EU, a market of 450 million people, after Britain leaves. One option is to shift enough assets to a euro zone country to qualify for ECB supervision.
Citi's Irish unit, Citibank Holdings Ireland, was added to a list of large banks directly supervised by the ECB on Monday, after it expanded its balance sheet through last year's merger with UK-based Citibank International.
Citi itself has said it might have to re-allocate certain businesses to the EU, but it would not "hot foot" it out of Britain.
The Irish subsidiary houses Citi's retail banking operation in Europe and has around 46 billion euros ($48.93 billion) in assets. But it could not accommodate Citi's brokerage or trading businesses.
Under U.S. regulation, those must be housed in entities separate from deposit-taking operations. Consequently, Citi's brokerage and trading are a separate operation, based in London. ■