Following one member having their UK bank accounts terminated with Brexit passporting concerns cited as the reason, thirteen members from EU and the U.S compared their experiences with banking relationships and Brexit.
The call was chaired by Damian Glendinning, whose commentary appears below.
The overall problem remains that there is very little clarity as to what will actually happen – we are still in the transition period, where nothing changes until 1st January 2021.
Given the uncertainty, some banks have taken action, and have moved FX trading, bank accounts and overall relationship management out of the UK and into the EU: Dublin, Amsterdam and Paris seem to be the preferred locations. However, there is no consistency between banks.
For the corporates, this has meant some work in terms of moving bank accounts, re-negotiating ISDAs etc, but nothing major. Not many have moved staff out of the UK.
A couple of companies have moved their cash pools and cash concentration arrangements out of London to continental Europe, as a precaution.
Some corporates have had their banks (usually UK banks!) either terminate relationships or move them from the UK to the continent, citing Brexit as the reason. The consensus on the call was that Brexit was probably a pretext – there is nothing in Brexit which makes this a requirement. One possible explanation is the requirement banks in the UK have to ring fence their retail operations – but, again, this should not affect corporate business.
Some of these actions by banks are causing moves to fintech solution providers, who are typically providing similar services, but being more user friendly.
One participant deals with a French bank who have reassured them that their UK business is fully qualified under UK regulations to continue unchanged after Brexit
A couple of participants see significant potential changes to their business. Most do not.
Overall: this is an area where uncertainty remains the order of the day. Most companies have done as much as they can to prepare for what is known and clear – but that remains a small amount. We may see big regulation changes affecting UK banking operations – but even that is not clear.
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