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- EBA publishes its Roadmap on Fintech setting out priorities for 2018/2019
- David Thorburn to join Barclays UK’s Board as Non-Executive Director
- Financial services now paving the way for digital transformation
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- CMA announces two senior appointments expired
- FAB responds to media speculation suggesting intent to manipulate the Qatari riyal expired
- Most affordable mortgages in a decade, according to Halifax review expired
- MarketInvoice reaches £2bn milestone for loans to UK companies expired
- Finance industry stops £1.4bn in attempted fraud expired
- Goldman Sachs’ president and Co-Chief Operating Officer is to retire expired
16th June 2017
City of London responds to potential shift of euro clearing
It has been revealed that London could lose its euro clearing role when the UK leaves the European Union in 2019. A draft law by EU aims to give it the power to decide whether to move the lucrative euro clearing business post Brexit. European Commission vice-president Valdis Dombrovskis said Brexit needed "certain adjustments to our rules".
In response to the European Commission’s paper on euro-clearing, Catherine McGuinness, Policy Chairman at the City of London Corporation, said: “London is the unparalleled leader when it comes to clearing. The UK accounts for 40 per cent of the global trading. In contrast, the remaining EU27 member states account for less than 10 per cent of the combined market share. The EU is simply not equipped to handle the volume of clearing that the UK does each day.
“Each day the UK clears on average $2.1tn – more than the EUR885bn cleared, yet the US is not suggesting this function is repatriated. In taking steps to shift power away from UK clearing houses, the EU could damage itself unnecessarily. Fragmentation of foreign exchange and interest rate trading across Europe and the rest of the world could lead to firms’ costs increasing by as much as 20 per cent.
“We are also concerned that a location policy would impact across the international ecosystem in terms of market fragmentation and could increase systemic risk. The UK is the only place that can guarantee financial stability with the lowest possible cost implications. We do however welcome a structured and constructive discussion on these issues.”