Brexit

The Loan Market Association has warned that the European syndicated loan market faces ‘substantial market disruption’ in the event of a no-deal Brexit, as UK prime minister Theresa May faces a tough week of trying to get a deal she has brokered over the line.

The Bank of England's Financial Policy Committee on Thursday said that recent assurances from the European Commission on derivatives clearing were not enough to alleviate hard-Brexit disruption.

UK equity capital markets are feeling the pain from Brexit, with volumes from the country this autumn at one of the lowest levels in recent history.

As UK prime minister Theresa May looks to sell her Brexit deal to a disgruntled parliament, banks have been suggesting different options structures to clients to net positive returns from the resulting turbulence.

The European Securities and Markets Authority (ESMA) on Friday said that its board of supervisors supported “continued access” to UK clearing houses in a no-deal scenario.

The vague equivalence arrangement laid out as a possible future relationship between the UK and EU on financial services is unsuitable for two jurisdictions with such interconnected markets, and it is in the best interests of both UK and European firms to push for a closer relationship.

When market makers start sending runs (lists of prices) based on nation states rather than sectors it may be a harbinger of fundamental change in how European credit is traded.

Despite offering an attractive premium, TSB Bank was unable to garner enough interest for its five year sterling covered bond on Thursday, forcing it to postpone the deal. The decision followed a high level UK government resignation that caused considerable market volatility in the UK banking sector.

The European Commission, on Tuesday, told UK clearing houses and securities depositories to pre-apply to the European Securities and Markets Authority (ESMA) for recognition, should hard Brexit take place.

Representatives from European Union (EU) member states were debating the role of central banks within the EU on Tuesday, as part of discussions over controversial proposals for a new framework for supervising clearing houses.

The European Securities and Markets Authority (ESMA) has unveiled regulatory relief for EU counterparties that have non-cleared derivatives agreements with UK entities. The measures aim to help alleviate increased costs that may kick in due to a no-deal Brexit.

BNP Paribas has told between 80 and 90 London-based people in its global markets division that they may need to relocate to the EU in the event of a hard Brexit.