Banks

RBS share drop accelerates on stress test flop

Stressed. Shares in Royal Bank of Scotland have accelerated their losses this morning, falling over 4.5 per cent after the state-backed lender came in bottom of the heap in the Bank of England’s latest stress tests. RBS failed the toughest ever stress tests carried out by the BoE, with results this morning showing the lender’s […]

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Currencies

Renminbi strengthens further despite gains by dollar

The renminbi on track for a fourth day of firming against the dollar on Wednesday after China’s central bank once again pushed the currency’s trading band (marginally) stronger. The onshore exchange rate (CNY) for the reniminbi was 0.28 per cent stronger at Rmb6.8855 in afternoon trade, bringing it 0.53 per cent firmer since it last […]

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Financial

Sales in Rocket Internet’s portfolio companies rise 30%

Revenues at Rocket Internet rose strongly at its portfolio companies in the first nine months of the year as the German tech group said it was making strides on the “path towards profitability”. Sales at its main companies increased 30.6 per cent to €1.58bn while losses narrowed. Rocket said the adjusted margin for earnings before […]

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Property

Spanish construction rebuilds after market collapse

Property developer Olivier Crambade founded Therus Invest in Madrid in 2004 to build offices and retail space. For five years business went quite well, and Therus developed and sold more than €300m of properties. Then Spain’s economy imploded, taking property with it, and Mr Crambade spent six years tending to Dhamma Energy, a solar energy […]

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Currencies

Nomura rounds up markets’ biggest misses in 2016

Forecasting markets a year in advance is never easy, but with “year-ahead investment themes” season well underway, Nomura has provided a handy reminder of quite how difficult it is, with an overview of markets’ biggest hits and misses (OK, mostly misses) from the start of 2016. The biggest miss among analysts, according to Nomura’s Sam […]

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Categorized | Financial

Brexit ‘could hit 5,500 UK firms that use EU passport’


Posted on September 20, 2016

The scale of disruption that Brexit could cause in the City of London has been revealed by figures showing that 5,500 UK-registered companies rely on “passports” to do business in other European countries.

More than 8,000 financial services firms based in the EU or the European Economic Area rely on single-market passports to do business in the UK, according to numbers from the Financial Conduct Authority released on Tuesday.

    There is a growing fear in the City that once UK leaves the EU it will lose its passporting rights, which automatically grant access to other members of the single market in various sectors of the financial services. This allows companies to serve clients across Europe without having to win licences in individual countries.

    “The business put at risk could be significant,” said Andrew Tyrie, the MP who chairs the parliamentary Treasury committee, which published the figures it received in a letter from Andrew Bailey, chief executive of the FCA.

    “None of the current off-the-shelf arrangements can preserve existing passporting arrangements, while giving the UK the influence and control it needs over financial services regulation as it develops,” said Mr Tyrie.

    “No doubt the hard grind of establishing what best protects UK interests is already under way,” he added. “This issue needs to be right at the top of the in-trays of the chancellor, the governor of the Bank of England, and the UK’s lead negotiators.”

    Brexit complexity will add to costs for the City

    View of the City of London skyline from the FT offices this afternoon.

    Legal advisers and hedge funds will be among the few in City to benefit from Brexit vote

    The total number of passports held by UK firms amounted to 336,421, as many firms hold more than one for different sectors in different countries.

    The passports cover a range of different activities, including investment banking, corporate lending, insurance, payments and asset management.

    Many banks are still crunching the numbers on which parts of their cross-border operations would be most affected by the various potential outcomes of the negotiations for the UK to leave the EU.

    But several senior banking executives and their advisers told the Financial Times recently that an early consensus was forming around a figure of about 20 per cent, or £9bn, for the amount of investment banking and capital markets revenue that faces disruption in the most extreme scenario.