Cologne-based independent private bank Sal Oppenheim moved its group headquarters to Luxembourg, as of 1 July 2007, following a lengthy review. Germany’s sluggish regulatory regime and reduced levels of banking secrecy were behind the move. The bank’s decision to decamp for Luxembourg highlights a fundamental weakness in the German economy, the largest in Europe. With the exception of Deutsche Bank, a global powerhouse in investment banking, Germany has few financial institutions to match the reach of its thriving export sector. ''The fact is, some companies would more readily sell to a business based in Luxembourg,'' Matthias Graf von Krockow, head of the bank's executive team, told the International Herald Tribune. ''We have no choice but to dance to the music that is being played.'' Mr Krockow said that three years ago Alfred von Oppenheim, the bank’s patriarch who has since died, gave him a mandate to find a new home for the company, and the list was whittled down to Switzerland, Luxembourg and the UK. The Oppenheim partners signed up to back the Luxembourg operation for 20 years. Luxembourg ensures quick approval of new financial products, unlike the German regulator, Bafin, and has managed to preserve a far greater degree of banking secrecy. Sal Oppenheim has been family-owned for over 200 years, and is the largest independent private bank in Europe. It currently employs a workforce of around 3,500 at over 30 locations worldwide. The Sal Oppenheim Group currently manages and administers assets of €138 billion. Moving the headquarters to Luxembourg will shift only about 50 of 3,500 Oppenheim employees. Oppenheim still plans to hire about 200 people in Germany this year. Mr Krockow will split his time among Cologne, Luxembourg and the bank's office in Frankfurt. The core Oppenheim franchise is still managing money for people who have about €5 million, or more than $6.8 million, to invest, and it is the dominant player in much of Germany. The bank earned €248 million of its €309 million net in 2006 through private banking and asset management. But only about 34 per cent of profit came from outside Germany, a number it would try to push to 50 per cent during the next three years. Oppenheim this summer forged a joint venture with Compagnie Nationale à Portefeuille, the holding company controlled by the Belgian billionaire Albert Frere and which will invest in mid-size, publicly listed companies. It also took a 10 per cent stake in Miller Buckfire, a boutique investment bank in New York that specialises in complex financial restructuring, to work on cross-border acquisitions. Oppenheim also took full control of Financiere Atlas, which is a Paris firm with €1 billion in assets under management and will become Oppenheim's base for the French market. Oppenheim bought a stake in Prader Bank, a private bank in northern Italy, and opened offices in Warsaw and Prague to cater to the newly rich of Central Europe.