Brexit

The UK government is completely mishandling Brexit and its abandonment of financial services in negotiations has cast a cloud over the City. The government must now fix the situation via the most pragmatic Brexit possible — a bid to remain in the European Economic Area (EEA).

The UK government’s white paper on Brexit, presented as a way of moving negotiations forward with the EU, disappointed many in the UK financial services industry. However, the increasing likelihood of no Brexit deal at all means that disappointment doesn't matter — the proposals laid out in the white paper are little more than noise.

The UK government has revealed its position on the future of financial services after the UK leaves the European Union, which falls short of the passporting rights that banks have now but would be stronger than the existing third country equivalence regime in place by the EU.

French markets regulator, Autorité des marchés financiers, has expressed concerns over the supervision of UK clearing houses after Brexit, suggesting that UK home country supervisors may not focus on the stability of the European Union.

The City's various lobby groups should be pushing the UK government to pick one of the real, off-the-shelf options on offer from the EU for Brexit, rather than indulging its fantasies of a bespoke deal.

UK financial services advocacy group TheCityUK on Wednesday called for the continuity of cross-border derivatives contracts to be guaranteed after the UK leaves the EU.

As Brexit uncertainty kicks in, the clearing arm of German derivatives bourse Eurex has rewarded ten market participants, including HSBC and Barclays, for actively clearing interest rate swaps.

Lord Jonathan Hill, the former EU commissioner and architect of the Capital Markets Union project, has joined UBS as a senior adviser in its investment banking business.

Bank leaders have warned that Europe's politicians are so distracted by Brexit they might lose focus and strangle Europe’s growing capital markets.

In a document recently circulated at EU level, Paris labelled the MiFID II equivalence regime “inappropriate”, and called for a tighter procedure — a clear move to limit UK funds’ access to EU markets after Brexit.

With Brexit negotiations still fraught with risk, DCM and syndicate managers are already figuring out fixes to make sure that their primary markets business continues to function after the UK leaves the European Union — with the minimum disruption possible for their mainly London-based staff.

The International Swaps and Derivatives Association on Wednesday pushed for “enhanced supervisory cooperation” between clearing houses in the wake of Brexit.