Zahawi confirmed that a long-awaited Financial Services and Markets Bill will be brought before parliament on Wednesday to “harness the benefits of Brexit and transform the UK financial services sector”. Bankers are calling for swift reforms to boost London’s appeal as a global financial center after Britain leaves the European Union. Sign up now for FREE unlimited access to Reuters.com Register Amsterdam has already overtaken London as Europe’s top share trading centre, prompting Britain to relax listing rules as it tries to persuade chip designer Arm to list in London. Zahawi said the bill, which includes cutting “excessive” capital buffers at insurers for infrastructure investment, would unlock “tens of billions of pounds”, a step that pits it against a more cautious Bank of England. The bill also fights financial fraud by ensuring vulnerable people and rural areas have access to cash and introduces rules for the use of stablecoins, a type of cryptocurrency, for payments. “Consumers will remain protected, with the legislation ensuring victims of fraud can be compensated, while also acting to protect access to cash for the millions of people who rely on it,” Zahawi told guests at the annual Mansion dinner City of London House in history. financial district. Britain’s Payment Systems Regulator will have the power to compensate victims of so-called authorized push payment fraud, when fraudsters trick people into sending them money online. Regulators such as the Bank of England and the Financial Conduct Authority will have a secondary objective of promoting the global competitiveness of the financial sector, a requirement already faced by many regulators around the world. But some lawmakers fear it could herald a return to the type of light regulation that ended with the bailout of banks from the financial crisis. Zahawi said the new target would be “unequivocally” secondary to maintaining financial stability and protecting consumers. Part of the bill moves laws inherited from the EU into UK regulators’ regulations, making it easier to change them in the future, but also giving the watchdogs far more influence over parliament. As a hedge, the finance ministry had indicated it could give itself “call-in” powers to tell regulators to reconsider a rule if it believed it would be in the public interest. Lawmakers said this should be done sparingly, and Bank of England Governor Andrew Bailey warned last week that regulatory independence was part of London’s position as a global financial centre. Zahawi said subpoena powers would not be included in the bill, indicating a more cautious approach. “I want time to consider all the arguments before making such an important decision.” Caroline Wagstaff, chief executive of the London Market Group, which represents the insurance market, said the new financial services bill would only boost the industry if the competitiveness goal for regulators had real teeth. “The bill absolutely needs to contain sufficient detail on how regulators will be held to account on the issue of competitiveness, otherwise it will not achieve the regulatory culture change we need and will be just words on a page,” Wagstaff said. Vincent Keaveny, Lord Mayor of the City of London, said a clear commitment was needed to set out how regulators would focus more on competitiveness, but a “fire of regulation” would damage the industry’s international reputation. A government-sponsored review on Tuesday set out recommendations to speed up how listed companies can tap markets for additional funding, and Zahawi said all had been accepted by the government. read more A new digitization task force, chaired by former HSBC chairman Douglas Flint, will drive the modernization of shareholding by scrapping paper certificates. The government will also streamline the capital raising process by reforming the Companies Act to speed up rights issues and procedures around them, Zahawi said. The first annual ‘State of the Sector’ will be published on Wednesday to confirm the Government’s ‘vision for the sector’. Sign up now for FREE unlimited access to Reuters.com Register Additional reporting by David Milliken. Edited by Chizu Nomiyama and Jonathan Oatis Our Standards: The Thomson Reuters Trust Principles.
