Fears that banks are on the brink of leaving the UK following Brexit have created shockwaves in the business community.
The British Bankers’ Association (BBA) has warned that relocation out of the UK could come early next year with smaller banks moving their operations out before Christmas.
Writing in The Observer chief executive of the BBA, Anthony Browne said banks had been rattled by the tone of Brexit negotiations so far.
It’s predicted that the Government’s wish to control freedom of movement would mean Britain loses access to the single market. A knock-on effect of this would be a loss of “passporting” rights that allow UK-based banks to sell financial services across the European Union.
Banking is one of the UK’s biggest exports and is more internationally mobile than most other sectors. However, many of its rules and legal rights are from the EU.
Prior to the Brexit vote there was concern that a leave verdict could make accessing funding from banks even more difficult and more expensive for small businesses in the UK.
Head of Businesscomparison.com Philip Brennan comments:
“The government should be focusing on the banks as they are Britain’s significant revenue generator for the UK economy. We need to reassure them they don’t have to leave the UK. The government must prioritise getting the “passport” agreements sorted in order to provide clarity and reassurance to the banks.
“As Britain looks to promote itself as the Fintech capital of Europe it will require the “Fin” in the Finance to be located here. With Berlin and Holland activities seeking our entrepreneurs and banks we need to remove the doubt if they start to act. Finance services are 23% of our exports but they will not stay if it no longer becomes viable to stay here. Banks can relocate much more easily than manufacturing industries. We also need to look at the effect it would have on all subsidiary services for finance.”