Britain’s banks are planning to move overseas following uncertainty over the Brexit deal, according to the head of the British Bankers’ Association, Anthony Browne. Browne has warned that “their hands are quivering over the relocate button”, due to fears that the European Union will attempt to erect trade barriers between Britain and the EU in order to permanently weaken the City of London.
Browne has predicted that the smaller banks will begin moving their operations abroad within weeks, and that some larger institutions will follow them by early 2017. Banking is the UK’s biggest export industry, and as a result Browne has said that it will probably be “more affected by Brexit than any other section of the economy, both in the degree of impact and the scale of the implications.”
Banks rely on EU rules in order to serve their customers across borders. Brexit could lead to questions being asked about whether they will continue to have a legal right to provide services in certain jurisdictions. Currently, EU ‘passporting’ rules allow UK-based financial services firms to operate throughout Europe without having to seek additional authorisation. Browne stipulated that given the potential for negotiations with Brussels to last a number of years, it is in the banking industry’s best interests to take reasonable steps now to protect its future.