ECB’s Daniele Nouy talking Brexit
- A few UK banks have sought licences with EZ to move away from London
- ECB is worried that many banks are delaying decisions on relocation
The ECB are worried??There they go stepping over the “independence” line and trying to put the pressure on.
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Philosophy: “Don’t be a Dick for a tick”
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Philosophy: “Don’t be a Dick for a tick”
Read how Ryan got into trading here
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By September this year, only about 10 of the 40+ banks needing to apply, have applied formally and there is a 6-month+ lead-in until acceptance. Then it can take as much a 12 months to find premises and set-up IT systems and of course find the staff, which raises another problem: No one wants to relocate to Frankfurt and so it looks likely that Paris will have to be the centre (much to the chagrin of Germany, BUBA and the ECB who are Frankfurt-based). Paris doesn’t seem to have the premises available and those buildings that are suitable are partly let and in need of fefurbishment. If you have been to Paris, much of Paris needs refurbishing. Dark and dingy like Frankfurt and very un-like London City/ Canary Wharf.
Banks are mostly afraid of a hard Brexit scenario because the overnight instability could deprive them of business overnight as more than half the debt and equity issued is cleared through London based banks.
IF the remaining 30+ banks all apply for licences at once, it could take 12 to 24 months to ratify them all. that’s a lot of business lost overnight unless the EU authorities declare some kind of lead-in-time should a hard Brexit occur before banks have got their licences. The same banks have made clear that they estimate 18 months to set operations up outside of London. This takes them beyond March 2019 or at the very least very close to the deadline. Europe have been courting the banks but Europe has done diddly-squat to make it easy for banks.
Even the Dutch central Bank has had talks with banks, but then again, who wants to work with the cloggies?
The criteria extends the time needed to set up in Europe mainland: Business plans: Safety: Fitness of managers AND clients. Not to mention the fact that there are not enough qualified ECB banking supervisors. Not even enough to keep an eye on Italian banks.
All these things and many more are coming to light and the reality of a hard Brexit is by no means just a problem for the UK. The EU has to face some very stark realliries and so no wonder, tempers are beginning to fray. They realise now, it is not just the UK who are at risk and as if the EU?EZ don`t have enough problems on their plate.
dont forget ireland is doing their bit…to get some “traction”… and i wouldnt underestimate them…
the “luxs” and the dutch too…. and have heard from some people austrians “fight” for the chance to get some on the “side”….
too much….”dough”…involved…and everyone is looking to “secure their future bread”
Dublin would be the easiest place to move to, especially with the open border.
So let them go. There are hedge funds and other institutions who want the London space. When these banks want to return, they will have to either pay extraordinarily higher rents or set up subsidiaries in Europe instead of moving lock-stock and barrel. Of course, the ECB is scrambling right now to have loopholes plugged that enable subsidiary licences to be given. Typical EU procrastinations. Slow off the mark, slow on the uptake, slow to catch on.