Let’s get started! Insiders believe London can eliminate dreaded regulations and bring the financial sector flying.
With calls for ministers to do everything possible to encourage foreign investment, the City of London might break free from loathed regulation and send the lucrative finance sector soaring in a significant boost for Brexit Britain.
Financial services were largely neglected in the UK-EU post-Brexit trade deal, with a simmering dispute over severely restricted access to the bloc’s markets. The London Market Group (LMG), a trade organisation representing over 350 underwriters and brokers in London’s specialized insurance market, has released a roadmap outlining how it feels the sector can be greatly enhanced. The five-point roadmap will detail how the government and regulators may utilize revisions of insurance and financial services legislation to boost the sector, which generates more than $100 billion (£70.6 billion) in annual premiums.
The Association of British Insurers has already called for a drop in capital requirements for its members, and it is one of a number of business organisations pushing for adjustments to tough rules following Brexit.
Brexit, according to Caroline Wagstaff, interim chief executive of the LMG, allows the UK sector to “refresh and rejuvenate.”
“It’s a period in time when we can all step back, look at the environment, and say, how can we do it better?” she told the Financial Times.
One of the LMG’s suggestions is that restrictions governing UK subsidiaries of foreign companies be “scaled back.”
For example, the trade association argues that when an insurer situated in the European Economic Area (EEA) does not underwrite any British products, the country’s Prudential Regulation Authority is not required to intervene.
According to the LMG, such a move would “substantially increase the UK’s competitiveness and appeal to EEA firms looking to offer global insurance in the London market, while posing no danger to UK policyholders.”
Other suggestions include the regulator relying more on non-EU authorities for supervision, such as in countries where the laws are similar to those in the UK, and treating reinsurance divisions of large insurance groups with extra caution.
The Prudential Regulation Authority (PRA), according to Anna Sweeney, executive director, is “taking steps to streamline the criteria that branches are subject to.”
But she added: “There can be no question of insurance branches being held to lower standards than.”Brinkwire Summary News”.