FRANKFURT (Reuters) - Frankfurt’s international schools see a bonus from Brexit after a deluge of calls from bankers who are set to be posted to Germany’s financial center along with their children now that Britain has decided to leave the European Union.
The city is the most popular place for banks to set up their new EU headquarters, prompting a surge of interest in its 12 international schools which teach in English and follow baccalaureate programs.
Paul Fochtman, head of the Frankfurt International School, said his usually quiet summer holiday was spent this year hosting planning calls three times a week to discuss Brexit.
“There’s no question a number of people are coming here,” Fochtman told Reuters on the 1,800-person campus on the edge of a hilly forest in one of Frankfurt’s affluent suburbs.
Studies show as many as 10,000 jobs could move from London to Frankfurt over the next four years, according to Frankfurt Main Finance, a lobbying group that promotes the city as a financial hub, possibly bringing with them thousands of students.
Among banks that announced plans to relocate some of their EU operations to Frankfurt are Citigroup (C.N), JPMorgan Chase (JPM.N), Morgan Stanley (MS.N), and Standard Chartered [STANB.UL]. A number of Japanese banks have opted for Frankfurt including Daiwa (8247.T), Sumitomo Mitsui Financial (8316.T), Mizuho Financial (8411.T), and Nomura Holdings (8604.T).
Although schools are keen on new business, they are cautious about the uncertainty surrounding Brexit, wary the influx of bankers could be lower than some lobby groups estimated or that some may commute while their children stay in London.
Even though Brexit only becomes official in March 2019, schools are proving to be an early indicator of future moves given the importance that parents put on a child’s education, which is often paid for by the employer.
“School is often the No. 1 barrier to a move for families,” said Fochtman, whose school is losing 50 pupils after General Motors reduced its workforce in Frankfurt following a takeover of its Opel unit by France’s PSA Group.
Frankfurt’s Strothoff International School said it was looking to buy land to build a new campus which would double its student body.
Paris and Dublin in their pitches to attract bankers leaving London also committed to providing new schools for bankers’ children.
In December, about six months after the Brexit vote, Eric Menges, chief executive officer of FrankfurtRheinMain, another group that markets the city, asked school officials to examine how Brexit would affect the education sector.
“Within 30 minutes of the banking district, there are 30 bilingual schools, 12 of which offer the classic international school degree,” Menges said. Educators estimate about 10,000 international and bilingual students are currently enrolled.
Schools have said they will need financial guarantees to fund any significant expansion. One executive of a U.S. bank said it was in discussion with schools in Frankfurt to secure places and was asked to pay money in advance.
Fochtman, whose school serves 60 nationalities, was initially skeptical that Brexit would impact his school until senior bankers began knocking on the door.
“LEFT HOLDING THE BAG”
So far this year, Fochtman has hosted nine delegations from banks considering moving to Frankfurt. Delegations typically consisted of senior bankers and human resources executives.
In the spring, Fochtman formed a taskforce to consider expansion but the school board decided to put on hold plans to build a new 1,800-person campus to focus on incremental growth until they have firmer signs the influx will be significant.
Uncertainty surrounding Brexit was behind the caution. “We are left holding the bag” if the school builds for an additional 2,000 and fewer show up, Fochtman said.
At Strothoff International School, south of Frankfurt, Bettina Otto, head of administration, said she was in contact with banks and was looking at “several options” for a new campus to grow the student body from 300 to 800. She has already raised teaching staff numbers by five to 60, partly due to Brexit.
In Dublin, a new private international school catering for local and expatriate students aged between three and eighteen years is scheduled to open in September 2018 and is hoping to benefit from relocating bankers.
As part of Paris’ charm offensive to net employees from the big banks, France has pledged to build three more international schools targeted at expatriates’ children in the greater Paris region by 2022.
Tuition fees at Frankfurt International School for a 12th-grade student are about 22,100 euros. In comparison, a place for a 12th-grader in the British School of Brussels is around 34,000 euros.
“It is also worth noting that the most expensive international school here (Frankfurt International School) would be considered to be in the lower price bracket compared to other international schools across Europe,” said Menges of the FrankfurtRheinMain marketing team.
Reporting by Tom Sims; Additional reporting by Padraic Halpin in Dublin and Anjuli Davis in London, editing by Peter Millership