Britain ‘just getting started’ on boosting London’s competitiveness, says minister
Britain is just at the beginning of post-Brexit efforts to keep London a top global financial centre, but deregulation will be selective to ensure high standards are kept, financial services minister Andrew Griffith said on Thursday. Finance represents one in every 10 pounds of UK economic output, but has been largely cut off from the European Union by Brexit, prompting industry calls to ease red tape to cope with competition from Paris and Frankfurt, as well as New York and Singapore.
Britain has proposed a draft law to reform parts of the financial sector, now being approved in parliament, to regulate stablecoins, cut insurance capital requirements and end restrictions on trading shares, but Griffith said there was more to come. “I am determined to do everything I can to help this industry succeed… We are only just getting started,” Griffith told an event held by TheCityUK, which promotes the financial sector abroad.
Financial sector access to the EU faces being reduced further as the bloc is set to propose a law next week to put pressure on EU banks to shift clearing of their euro derivatives from London to the bloc. “There is … no reason why the UK cannot and should not continue to provide clearing services for countries in the EU, indeed around the world,” Griffith said, adding Britain this week was taking steps to raise already high standards for clearers.
Faced with calls from industry and some lawmakers for Britain to reap “Brexit dividends”, Griffith said there would be a further package of reforms to “selectively” repeal EU financial rules. “It will never be deregulation for deregulation’s sake,” Griffith said.
Recent events in crypto markets – a reference to the collapse of crypto currency FTX – reinforce the case for timely and clear rules for the sector, with a consultation on a “world leading crypto regime” later this year, he said. The government will also implement recommendations made in a review by Mark Austin to overhaul how already listed companies issue stocks and bonds to raise more funds, he said.
Earlier this week, Griffith indicated a requirement on banks to ring fence their retail arms with a bespoke cushion of capital would be eased. “We’ve got everything we need to ensure the best days lie ahead of us,” Griffith said.
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