Britain sets out vision for post-Brexit financial servicesPosted On: Jul. 1, 2021 8:15 AM CST
(Reuters) — Britain’s finance minister set out his vision for financial services on Thursday, saying Brexit was a unique opportunity to tailor rules while maintaining high regulatory standards and open markets.
Rishi Sunak, in his first Mansion House speech — traditionally an annual address given by the finance minister in the City of London financial district — set out how he wants to “sharpen” the sector's competitive advantage.
Britain’s full departure from the European Union last December largely severed the City’s ties with investors on the continent, triggering a shift in over 7,500 financial jobs from London to new hubs in the bloc.
Last year the finance ministry rolled out reviews to listings rules, fintech and insurance capital rules, and on Thursday it announced there would be further public consultations on financial reforms.
Rules on prospectuses, which give investors information about companies that want to list, will be reviewed so that “more companies can and do list on U.K. markets,” Mr. Sunak said.
A review of capital markets will focus first on "immediate changes" to remove the “most ineffective and distortionary regulatory requirements” that the UK inherited from the EU, such as the share trading obligation and double volume cap.
These refer to rules that require banks to trade on a particular platform, and curbs on how much share trading can take place off an exchange in the “dark.”
The ministry will also set out how it wants to see insurance capital rules amended following its consultation.
There will be a public consultation on safeguards on access to cash after the pandemic accelerated a trend toward cashless payments and bank branch closures.
Mr. Sunak said there will be new sustainability disclosure requirements for companies to report on the impact they have on the environment, a step the EU has already taken.
To date, sustainability disclosures only look at how climate change affects a company's financial performance, and Mr. Sunak will publish more details ahead of the UN COP26 climate conference in Glasgow in November.
The financial sector was largely left out of Britain’s trade deal with the EU, cutting lucrative ties with investors on the continent, and the industry has called for a government strategy for the City.
The EU has yet to decide how much direct access it will grant the City in the future, but Mr. Sunak said Thursday Britain will establish a “ground-breaking” system of cross-border access for the sector with Switzerland.
Such access based on non-EU member Switzerland and Britain recognizing each other's financial rules was rejected by Brussels.
The government on Wednesday set out details for the sale of Britain's debut sovereign green bond or gilt, and a “world-first” green savings bond.