Brexit

Prominent German member of the European Parliament, Markus Ferber, has put down suggestions that European regulators should be granted powers to temporarily exempt market participants from regulations.

The Financial Conduct Authority on Monday expressed concerns over the potential consolidation of market power in the hands of a few trading and clearing players, saying that a "lack of competition" could result in "higher prices" or a reluctance to invest to meet client needs.

Any capital markets professional breathing a sigh of relief over the agreement of Monday's Brexit transition deal between the EU and the UK, should stop to realise that all this agreement does is prolong the uncertainty.

A top US derivatives regulator on Wednesday went into battle against his European counterparts over their new proposal that will increase the stringency of the EU’s oversight of foreign clearing houses.

Bond clearing house Euroclear intends to move its holding company from the UK to Belgium as it prepares for the “risks” posed by the UK’s departure from the European Union.

Deutsche Boerse's new CEO, Theodor Weimer, said this week that, given the low market volatility of 2017, there were "headwinds" for the exchanges group, but that there was opportunity heading into 2018.

The inaction and silence from the UK government on Brexit means that the City should be focused on finding a mutually beneficial way to do business with the EU, rather than waiting for the government to take the lead.

The UK government has left stakeholders completely in the dark over its plans for financial services after Brexit leading to calls from some EU politicians that the City try to bypass the stalled government talks and offer a payment for access to the bloc.

Two US senators have scolded the European Commission's efforts to unilaterally change agreed rules for the oversight of foreign clearing houses in the wake of Brexit, backing the toughening position of Commodity Futures Trading Commission chairman Christopher Giancarlo.

Banks and other financial firms operate in complex lattices of regulation. But for any firm based in the UK and operating internationally, Brexit means they have no idea what regulations will apply, come March 2019. They cannot afford to do nothing, yet do not know what to plan for. As Nigel Owen reports, the response has been to plan for every scenario, including relocation from London.

A finer point debated in the Brexit negotiations is whether Britain will also leave a European judicial cooperation scheme. That would mean that English law, under which restructurings and bond prospectus terms and conditions are most often written, would not apply to cross-border contracts.

The German Investment Funds Association (BVI) demanded the relocation of euro denominated interest rate swaps clearing from London to the EU 27 on Wednesday, citing regulatory concerns due to Brexit and lower costs for fund companies.