Friday 23 March 2018

Helaba Dublin to hand back its Irish banking licence and quit IFSC

Donal O'Donovan

Donal O'Donovan

One of Germany's biggest state-owned banks, or "landesbanken", is in the process of handing back its Irish banking licence as part of a phased wind-down of its operations at the IFSC.

The growing cost of banking regulation here is cited by senior figures at the bank as one reason for the decision to hand back a licence the bank has held for 20 years.

The decision means Helaba will no longer be regulated by the Central Bank of Ireland.

Job numbers have already been cut to 20 at the bank from a peak of 40, with the bulk of the remaining jobs to go over the next six to nine months.

It is understood that regulated activities, including new lending, are being shifted back to the bank's home offices in Frankfurt.

Non-regulated work will continue to be done in Dublin by a smaller team charged with winding down the remaining balance sheet as a so-called "non-bank".

Helaba Dublin set up at the IFSC in 1990, initially as Helaba Asset Management. It received a banking licence in 1993, one of a significant number of German banks to establish operations in Ireland at the time, attracted in particular by corporation tax charges here that were significantly below the rates of as much as 50pc that applied in Germany at the time.

In Dublin Helaba engaged in commercial lending to international customers, including building up a significant portfolio of aviation and shipping loans.

A senior executive at the bank said Ireland's regulatory burden was no higher than in the rest of Europe, but the rising cost of compliance meant it no longer made sense for a small standalone banking operation, like Helaba, to bear the cost of being licensed in two jurisdictions.


Helaba's decision to wind down its Dublin operations is a path that is being examined by other similar sized German-owned banking units here, the source said.

The process of surrendering the Irish licence has begun following the repayment by Helaba Dublin of all of its customer deposits.

Helaba International Finance, a non-bank Irish financial services company that was part of the group, has recently gone into voluntary liquidation following the expiry of its business activities.

Irish Independent

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