There will be no access to the European Union for Britain's derivatives clearing houses after June 2025, the bloc's financial services chief Mairead McGuinness said on Friday. Britain's departure from the EU has largely severed the country's financial services ties with the bloc.
But
clearing in London of euro-denominated derivatives for banks and asset
managers in the EU was allowed to continue because of the risk of market
disruption if the huge volumes involved had to be moved in a short
time.
The
London Stock Exchange's LCH business holds 92 trillion euros in euro
interest rate swaps positions, compared with 11.4 trillion euros at
Deutsche Boerse in Frankfurt.
Brussels
on Tuesday extended "equivalence", meaning UK clearing access, until
June 2025 for a final time to reduce heavy "over-reliance" on clearers
in London. read more
Bank
of England Governor Andrew Bailey said on Thursday that Brussels should
not have set a time limit on clearing access, and that seeking to
fragment the international financial market cannot be justified. read more
McGuinness said the EU had an open financial market and wanted to build up its own capital market.
"I am very clear that June 2025 is the end of equivalence for UK clearing houses," McGuinness told a Politico event....
more at Reuters
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