Brexit will split financial markets, says Bank of England appointee

By Huw Jones LONDON (Reuters) - Brexit will make markets less efficient but it won't be disastrous for Britain's economy, an appointee to the Bank of England's Financial Policy Committee (FPC) said on Monday. Britain left the European Union in January, with transition arrangements that afford continued full access to the bloc ending in December.

Reuters July 21, 2020 00:06:22 IST
Brexit will split financial markets, says Bank of England appointee

Brexit will split financial markets says Bank of England appointee

By Huw Jones

LONDON (Reuters) - Brexit will make markets less efficient but it won't be disastrous for Britain's economy, an appointee to the Bank of England's Financial Policy Committee (FPC) said on Monday.

Britain left the European Union in January, with transition arrangements that afford continued full access to the bloc ending in December.

"It will cause fragmentation, it will cause inefficiency, there will be problems with regulation, but it's not going to be disastrous... for the economy," Jonathan Hall, told a confirmation hearing in parliament's Treasury Select Committee.

Faced with an economy slammed by the COVID-19 crisis, Hall, a former Goldman Sachs banker, is due to start a three-year term on the FPC, a body set up after regulators failed to spot the last financial crisis coming a decade ago.

Britain's financial sector is "quite different" in size and complexity compared with its European peers, Hall said.

Future direct EU access for financial firms in Britain will hinge on Britain remaining "equivalent" or aligned with rules in Europe, but Hall said Britain can't be a "rule taker".

"It's very important that the UK does remain the regulator for the financial market in the UK," he said.

Britain's banks, some of whom needed rescuing by taxpayers in the last crisis, were in good shape when the COVID-19 shock hit markets in March, he said.

It was "so far, so good" and there is no evidence that tougher capital rules brought in after the last crisis were restricting the ability of banks to lend to help businesses recover from the impact of COVID, Hall said.

Britain is looking at ways for insurers, pension funds and others to invest in firms struggling to repay loans taken out during the pandemic.

"You can imagine some kind of closed-end fund that has a very diversified pool of small and medium sized businesses. But does the public sector need to do anything to help that along given this needs to move faster?" Hall said.

(Reporting by Huw Jones; Editing by Andrew Heavens and Ken Ferris)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

also read

Pulitzer Prize-winning photojournalist Danish Siddiqui killed in Afghanistan: Politicans, journalists pay tributes
India

Pulitzer Prize-winning photojournalist Danish Siddiqui killed in Afghanistan: Politicans, journalists pay tributes

The Pulitzer prize winner, who was in Kandahar covering operations against Taliban, was killed when he was riding along with the Afghan Special Forces

Indian photojournalist Danish Siddiqui killed during assignment in Afghanistan's Kandahar province
India

Indian photojournalist Danish Siddiqui killed during assignment in Afghanistan's Kandahar province

Siddiqui had also covered the 2020 Delhi riots, COVID-19 pandemic, Nepal earthquake in 2015 and the protests in Hong Kong

Danish Siddiqui's passing is a reminder of the high price one pays for showing the truth
India

Danish Siddiqui's passing is a reminder of the high price one pays for showing the truth

Danish's photographs were not just documentation, but the work of someone who went down to eye-level, as they say in photographic parlance.