The British regulator, rarely touching on the topic of negotiations between London and Brussels, recommended preparing for a “tough” scenario.
At the moment, relations between the United Kingdom and the European Union are governed by transitional norms. In fact, cooperation remains on the terms preceding Brexit, however, the transition period expires already in 2020.
Until then, the parties must come to a long-term agreement. Otherwise, Britain will leave the EU without a deal, which will hit its economy. London has the right to request an extension of the transition period, but this must be done by July. Moreover, Boris Johnson demonstrates that he does not intend to delay the process, despite the negative consequences.
Britain’s financial elites predict ten-year crisis
On Wednesday, June 3, the Bank of England emphasized the likelihood that the United Kingdom has every chance of facing the consequences of a “tough” Brexit. The statement emphasizes that the country’s banks should prepare for this.
The communique was published immediately after it became known about the negotiations of the head of the central bank, Andrew Bailey, with the heads of other financial institutions of the country.
“For the Bank of England, it is imperative that it prepares the UK financial system for all the risks that it may face,” the statement said.
It is noteworthy that large British banks have already been reinsured. In particular, they open subsidiaries in the EU to continue to conduct business.