05 Feb 2020
Germany’s top financial regulator says banks are well prepared for Brexit, until you look at their list of clients.
While many details of the U.K.’s future relationship with the European Union remain unclear, global banks have already set up units in the bloc to retain access to those markets. The problem is that London is still the docking station for huge pools of international capital, and companies and investors aren’t keen to move their business until the politicians hammer out the details, BaFin President Felix Hufeld said in an interview.
“That’s the piece of course which worries us,” Hufeld told Bloomberg TV’s Guy Johnson on Tuesday. “There’s no major industrial corporation that’s willing to make massive changes, which do cost money, without knowing when exactly and why exactly things have to be changed.”
Banks have done far more than 80% of the work needed to deal with Brexit from a legal and technical standpoint, said Hufeld. But when it comes to moving client business to their EU hubs they are, on average, less than a third of the way there, he said.
While the U.K. and EU will probably be able to “rebuild strong relationships,” failure to do so would mean losing out to financial centers like New York, Singapore or Shanghai, he said.
By Nicholas Comfort and Silla Brush, Bloomberg, 4 February 2020
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