Following the loss of business after Brexit, Rishi Sunak announced a series of reforms aimed at increasing global traction in London’s equity trading and listing.
On Thursday, the Prime Minister released details of proposed changes to the rules governing stock market listings, stocks, bonds, commodity trading and insurance, emphasizing the UK’s willingness to split from the EU rules that once helped write.
Snack said the proposal, which also aims to encourage new technologies and promote green finance, is a “new chapter in financial services.”
In an extensive review, the Treasury also announced plans to force large banks and building-and-loan unions to ensure that cash withdrawals and deposit services are available within a “reasonable” distance for most populations. did.
The UK’s proposal for financial services, one of the UK’s largest export industries, has become more urgent six months after leaving the EU single market.
After the Brexit transition period on January 1, Brussels rules banned him from staying in London, moving about € 8 billion of EU stock trading to Amsterdam and Paris per day.
Also in London Lose Hurry to Frankfurt and New York to attract so-called Spack, or blank check companies, for more favorable listing rules. At the same time, one of its strengths, the city’s share of the global market for derivatives trading, has declined as traders have been relegated elsewhere.
Snacks acknowledged that Britain’s efforts to reestablish more efficient access to the EU market through so-called “equivalence” standards have so far failed.
Rob Moulton, Global Co-Chair of Financial Regulations for Latham & Watkins, said: ..
Much of the Treasury’s reforms focused on Mifid II, a vast rulebook introduced by the EU in 2018 to cleanse the market after the financial crisis. Since its introduction, many executives have complained that many regulations are either too normative or create inefficiencies and provide little benefit to the market.
“It’s great to see market feedback incorporated in the reviews. As a global financial center, the UK needs to secure an open, deep and efficient capital markets, and many of the proposed changes We support the achievement of that goal, “said Kay Swinburne, Vice Chairman of Financial Services at KPMGUK.
In EU regulations, the criteria that the UK plans to dispose of are those that determine where investors can trade stocks and are known as stock trading obligations. The application of this EU standard withdrew the business from London in January, but initially prevented banks from bypassing the stock exchange and trading their clients at their trading desks in the process. It was designed to do.
He also said he would like to abolish EU regulations that limit the volume of transactions that investors can carry out in the private market called the “dark pool.”City Minister John Glenn said Cap was “in good faith [had] The evidence is unfounded. “
The Prime Minister also endorsed some of the proposals presented by Sir Hill. report About the UK list, including the reform of prospectus rules.
Other plans included reforms to commodity derivative rules that the Treasury described as “insufficiently designed and inefficient.” With the implementation of the Mifid rules at the time, the Intercontinental Exchange transferred hundreds of energy futures contract transactions from London to the United States, allowing customers to circumvent new standards.
The Treasury has also labeled the system that regulates the insurance industry as “overly strict and rule-based.” He said there was a “strong case” to reform the risk margins used to calculate the insurer’s capital requirements and the so-called matching adjustments that determine where to invest.
In February, the UK Insurance Association claimed that the change would allow insurers to relocate a total of £ 95 billion in capital, giving them more freedom to invest in areas such as infrastructure and green assets.
The prime minister also eases concerns that millions of older and vulnerable consumers may lose access to cash as consumers move rapidly to digital payments and banks close branches and ATMs. I promised that.
Sunak confirmed that banks were forced to fund services and that the Treasury had the authority to set “geographical access requirements” to ensure cash facilities were available. There are no limits yet on the distance to cash services and what percentage of the population should be within range.
John Howells, CEO of Link, which operates the UK’s automated teller machine network, said the talks were “very positive”, but “ATMs and branches are literally closed daily. Therefore, it needs to be implemented promptly. “
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