CurtainRaiser Posted January 28, 2021 Share Posted January 28, 2021 The US and the EU have just done a deal. A massive deal. One that changes everything. The UK was at the table. But it didn’t know it. For a simple reason. It was the lunch. The EU and US do deal to open up EU financial markets to US banks. As UK banks have only time limited access to EU financial markets it is likely that without a deal UK clearing banks will lose out to EU and US banks putting at risk London’s role as dominant financial centre. The deal requires US banks to adhere to EU risk management requirements - something that the UK wanted to avoid due to “sovereignty issues”. EU concerned with avoiding another financial turbulence like the 2007 global crisis and in maintaining EU banks competing advantage - so the EU-US agreement is considered a key part of this plan. The UK not involved in these discussions. City new outlets and Reuters now reporting on this. Effectively ends UKs determining role in EU financial markets as US banks gain regulatory equivalence and market access providing they stick to risk requirements. In financial terms this is as historic as it gets. Of course this reflects well on the US-EU relationship under Joe Biden...but be in no doubt... ...these negotiations will have started under Trump. So while Express & Telegraph were churning out Brexit boost & special relationship stories this was what was really happening. EU strategy here was part of a 3 Pilar approach: 1. EU banking liquidity & competition 2. Best practice risk management 3. Seriously cutting down on tax haven use Brexit ironically may have helped accelerate this process as dominant player UK no longer involved. https://ec.europa.eu/commission/presscorner/detail/en/ip_21_205?cookies=disabled From Twitter This is the final nail in the coffin for UK financial services and answers the question why the EU didn't want them included in any deal. Link to comment Share on other sites More sharing options...
Barryd999 Posted January 28, 2021 Share Posted January 28, 2021 And of course Biden is much more keen to work with the EU than the UK and Johnson right now. This is worrying news indeed. Link to comment Share on other sites More sharing options...
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