Banks In UK Ready For Brexit?

Leonardo Gonzalez Dellan is a successful banker in his early career therefore he recognizes the pressure that is currently felt by financial institutions in the United Kingdom. Only six months left until the deadline given for the Brexit negotiations is coming to an end. As with any major changes, banks are exposed because of operational risks present. The big question now is whether the banks in Great Britain are already prepared for what is coming?

There is nothing concrete that has been announced yet with regards to Brexit negotiations and how things will unfold will determine the future of banks in Britain that are internationally active. The banks and even their regulators did not send out any indication that they are already prepared with the upcoming Brexit. This is why many of the investors are already worried, not to mention the rating agencies.

Ever since the voting that transpired two years ago, United States banks have not shown any indications whether they are already prepared for the upcoming Brexit. According to Basel Committee on Banking Supervision or BCBS, operational risk is a form of loss, whether directly or indirectly, that is the result of failure from internal systems, people or process and it could also be caused by external events.

It is not easy to determine operational risk therefore it is also hard to identify how much capital should be set aside in order for the bank to withstand any losses that might results from the market disruption. Even regulators are not questioning banks as to the provisions they have prepared in order to cover the operational risk that will result from the Brexit negotiations.

Majority of the attention has been shifted towards the economy of the United Kingdom because of the impact of Brexit but what many do not realize is that the problem is not isolated to British banks alone. In fact, according to Leonardo Gonzalez Dellan who is an excellent banker, Brexit is going to change the scene of international financial services. Because of the status of Great Britain in the financial circle, many banks all over the globe should be aware of the impact that Brexit negotiations will have.