You have successfully emailed the post. Bank of England publishes checklist of key financial stability risks brexit england a “no deal” Brexit. These include the “continuity of existed cross-border insurance and derivative contracts,” and “ensuring a UK legal and regulatory framework for financial services is in place.
BoE Governor Mark Carney laid out the plans at a press conference following the release of the bank’s twice yearly Financial Stability Report. LONDON — The Bank of England’s key Financial Policy Committee is creating a checklist of all the risks to UK financial stability should Britain fail to secure a Brexit deal. While the Bank of England is currently working on the assumption of what it calls a “smooth” Brexit — effectively where the UK leaves the EU with some form of deal, and most likely a transition arrangement — it has also taken steps to address what could happen in the event of a so-called “cliff edge” exit. Risks from a cliff edge are significant, with the financial services sector — and particularly the derivatives and insurance markets — likely to be among the worst impacted. That’s because these areas of finance rely on a series of fiendishly complicated cross-border rules and regulations which allow the free movement of capital around the continent. If Britain drops out of the EU without a deal, many of those rules could cease to be in effect, causing chaos in the derivatives markets.
As such, the FPC, which is tasked with ensuring the stability of the UK financial sector, is taking steps to mitigate such risks. Consistent with the bank’s statutory responsibilities, the FPC is publishing a checklist of the steps that would promote financial stability in the United Kingdom in the event of a no deal outcome,” Bank of England Governor Mark Carney said at a press conference following the publication of the Financial Stability Report on Tuesday. This checklist has four important elements,” he said. Ensuring that a UK legal and regulatory framework for financial services is in place at the point of leaving the EU. The government plans to achieve this through the EU withdrawal bill and related secondary legislation. Recognising that it will be difficult ahead of March 2019 for all financial institutions to have completed all the necessary steps to avoid disruption in some financial services.