AUS
NZ
UK
CA
USA
IND
Summary
- The British government is committed to reinstating the UK financial services industry as one of the world’s pre-eminent financial hubs.
- As a part of the potential deal, British-based exchanges are expected to recommence trading Swiss shares in the first week of February, subject to parliamentary approval.
Chancellor of the Exchequer Rishi Sunak is expected to hold talks with the Switzerland counterpart regarding the potential trade deal that is expected to bolster ties between the two countries in the financial services arena.
As Britain quit the European Union on 31 December 2020, UK’s financial sector is in dire need of a lucrative deal. Under the post Brexit talks with the EU, Britain wanted the City of London to retain its global financial hub image, though the idea of mutual recognition in the trade deal was rejected by the EU.
Also read: IMF downgrades UK economy’s forecast for 2021
However, Britain and Switzerland are likely to accept the broad thrust of each other's financial rules in the potential deal. Both are committed to high standards of regulation and compliance, along with investor protection.
As a part of the potential deal, British-based exchanges are expected to recommence trading Swiss shares in the first week of February 2021 subject to parliamentary approval, although exchanges might take time to see volumes grow. Sunak is expected to discuss capital markets, asset management, banking, and insurance services with the Swiss counterpart. Sunak is also expected to initiate discussions with the biggest global banks. He is likely to provide an update regarding the deal during the upcoming budget in March.
(Image Source - © Kalkine Group 2020)
The financial sector is undergoing a huge transformation with the evolution of fintech companies, and there is a plethora of new untapped opportunities as the UK left the bloc. Both countries are eager to forge a comprehensive agreement in the financial services sector.
The EU has pushed the UK for equivalence, or a full alignment of rules. The bloc uses equivalence for defining the rights of a foreign bank in the EU market. Also, it defines the rights and regulatory treatment of domestic banks on foreign soil.
The British government is committed to reinstating the UK financial services industry as one of the world’s pre-eminent financial hubs. The government expects the potential deal to stimulate the market for corporate green bonds. The government has mandated the groups operating in the sector to make disclosures of their exposure to climate change risks by 2025.
