Brexit Is a Chance for the City to Forge Bold Relationships with Regulators
Abigail Gammie writes about London's post-Brexit regulatory landscape, risk assessment, and a system guided by sound principles.
This article originally appeared in City A.M. on 29 August 2017.
Brexit will remove the power of key authorities and regulators from the European Banking Authority to the European Court of Justice—or so the Prime Minister has pledged.
Whatever the details of this separation, it is clear that the City will find itself in a different regulatory landscape.
While the potential drawbacks of losing EU membership have been well-documented, this new regulatory landscape should be seen as an opportunity for the City to forge a new relationship with regulators—one that helps secure its position as a global financial centre and champion of innovation.
To see how this could be achieved, we should first look to what it was that gave London its pre-eminent position in the first place. Language and time-zone played their part of course, but part of the reason for its growth from the 1980s onwards has been its light-touch regulation. This in turn fostered a culture of innovation which helped fuel the growth of the London derivatives market by allowing new products and trading methods to flourish.