Regulator Warns Financial Institutions Not Ready for Brexit

Banks are not yet prepared for a “no deal” Brexit and must act now to avoid putting the stability of the financial system at risk, according to the European Union’s top regulator.



In an opinion published Monday, the European Banking Authority said that preparation for a scenario where Britain crashes out of the European Union without an agreement on how to manage future ties has been “inadequate.”

“The necessary mitigating actions take time, and should be pursued without further delay,” the regulator said.

“Financial stability should not be put at risk because financial institutions are trying to avoid costs.”

There are just over nine months to go before Brexit, but Britain has not yet secured a deal that eliminates the risk of an abrupt departure from EU arrangements that allow banks and businesses to trade freely across Europe.

The regulator warned that banks cannot assume such an agreement will materialize.

via CNN

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza