Plan seen as direct challenge to EU to adopt a similar policy for UK-based banksThe Bank of England plans to allow European banks to maintain their UK operations under current rules following Brexit, in a direct challenge to European Union regulators to adopt the same policy towards UK-based banks. The Treasury is expected to give the Bank additional powers to supervise foreign bank branches in the UK, a job largely done by regulators based inside the EU. In response to Barnier’s warnings to the City, Carney cautioned that denying UK financial institutions passporting rights would hurt both sides. “The UK financial system, like it or not, is effectively the banker for Europe, in the most complicated bits of finance,” he told MPs. Currently banks and financial institutions outside the EU can gain access to European capital markets, if the rules in their home country are deemed equivalent to EU standards.

Source: The Guardian December 20, 2017 17:45 UTC