Britain-based financial institutions seeking to maintain their accessibility to the euro zone after Brexit are working out of time and need to not count on a deal about a transition period, European Central Bank board member Sabine Lautenschlaeger said on Wednesday.
With Britain because of to depart the EU in March 2019, financial institutions are established to lose their automated access to the single industry and negotiations over a transition period of time have been sluggish, increasing doubts that a deal would be struck.
“We can’t be positive whether the transition period of time will actually occur,” Ms Lautenschlaeger, who is also the vice chair of the ECB’s lender supervision arm, instructed a information conference. “Banks must be ready for Brexit it will occur.”
“Any financial institution that wishes to relocate from the United kingdom to the euro region should really have submitted its licence software previously,” she mentioned. “But if it hasn’t, it must do so by the stop of the second quarter of 2018 at the newest.”
Eight banking institutions have currently taken official steps to seek out a new licence and 4 other people are arranging to significantly increase their activities in the euro spot, she extra.
But Lautenschlaeger explained the ECB might be open up to granting banking companies additional time to put into action their relocation ideas as lengthy as loan companies current large-top quality and credible programs.
“We won’t tolerate any empty shells,” she explained, repeating the ECB’s extended standing assistance. “Banks have to be ‘real’ banking institutions if they want to run in the euro area.”
“We therefore count on incoming banking companies to be able to create full and precise information on reserving types, hedging methods and intragroup exposures,” she stated.