By Oisin Sweeney • 11 December 2020 • 19:11
THE EUROPEAN Banking Authority (EBA) has warned that EU-based banks may be losing interest in taking exposures from UK banks in the event of a no-deal Brexit.
An ‘exposure’ is the risk a bank takes on when writing a loan, and are calculated using economic and political risk assessment. The EBA, Europe’s banking watchdog, has warned in a new report that a no-deal Brexit could disrupt the financial market of the City of London and the wider continent.
They highlighted the marginal increase in British exposures between January and June this year was dwarfed by the far greater volume of loans in the EU. The EBA warns that this might be evidence of a ‘diminishing interest’ in business investments that are exposed to the turbulent UK market.
The watchdog advised UK banks that have opened branches in the EU to retain access to the bloc should ensure that adequate management is in place should Britain exit without a deal on December 31st. Many of the UK’s top banks have opened bases in major EU business cities to avoid being severed from their European clients.
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Oisin is an Irish writer based in Seville, the sunny capital of Andalucia. After starting his working life as a bookseller, he moved into journalism and cut his teeth as a reporter at one of Ireland's biggest news websites. Since joining Euro Weekly News in November, he has enjoyed covering the latest stories from Seville, Spain and further afield - with special interests in crime, cybersecurity, and European politics. Anyone who can pronounce his name first try gets a free cerveza...
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