Sabine Lautenschläger, Member of the Executive Board of the ECB and Vice-Chair of the Supervisory Board of the ECB, talks about developments in the preparatory work of banks and supervision in light of the UK leaving the European Union, Supervision Newsletter (Summer 2017)
In summary, Lautenschläger said that:
- all affected banks should prepare themselves with a hard Brexit in mind
- banks must make decisions very soon; there is only a narrow time frame in which to assess plans and applications, following a standard process the ECB has already communicated
- ECB will oppose any race to the bottom in supervisory standards
- ECB has finished a first set of concrete guidance for supervisors on what needs to be taken into account when assessing back-to-back booking
- already one thing that the ECB can be clear about: although London will stay an important global financial hub, it will no longer be an automatic entry point to the European Union
- ECB expect banks to manage relevant parts of their risks locally and independently and not rely on a back-to-back booking approach