Brexit is approaching: banks are well-prepared and ready to serve their customers
22 March 2019 - 4 min Reading time
On March 29, 2019, the United Kingdom was supposed to leave the European Union. However, British Prime Minister Theresa May requested an extension of the Brexit process from the European Union. The European member states are willing to grant an extension until April 12 or May 22. Therefore, there is still uncertainty regarding the precise timing and the form that Brexit will take.
One thing is certain: Belgian banks have prepared themselves well for every possible scenario, including a soft Brexit, hard Brexit, extension, or cancellation. For individual customers, there will be little change. However, businesses may encounter potential issues. Febelfin has one message for them: talk to your banker in advance
What changes for entrepreneurs due to Brexit?
Belgium has very close trade ties with the United Kingdom. The country is our 4th and 5th trading partner for the export and import of goods and services.
A hard Brexit will, therefore, have an impact on the operational functioning and/or sales figures of many companies.
The reasons are not hard to find:
- increased trade tariffs
- volatile exchange rate fluctuations
- more customs formalities
- a decrease in demand for products and services
- diverging future regulations
The financial sector is well aware of this. Febelfin is in contact with other sector federations to monitor the impact of Brexit at the sector level and to discuss supportive measures if necessary.
Individual companies may face various issues due to Brexit. For them, Febelfin has one important message: talk to your banker in a timely manner. The sooner the bank is informed, the more opportunities there are to find a good solution together.
What does Brexit change for individuals?
For the Belgian consumer, Brexit has little impact on their daily banking affairs.
Even while on vacation in the UK, they can continue to use their Belgian debit and credit cards to make payments and withdraw money.
It's a different story for those who are customers of a British bank or want to invest in British financial instruments:
- A British bank will need to open a branch on the European mainland (Belgium) in order to continue serving its customers.
- Whether consumers can invest in financial instruments issued or listed in the United Kingdom depends on whether these instruments still comply with EU regulations after a possible hard Brexit. The banks will provide clear information to their customers about thi
What about the banks?
A hard Brexit would be the worst economic scenario for every party involved. However, the Belgian financial sector is well-prepared. Regardless of the ultimate outcome of Brexit, Belgian banks will not interrupt their services.
All banks have developed plans to prepare for the potential consequences of a hard Brexit. The specific measures in these plans vary from bank to bank and depend on the services they offer. These plans have been shared with regulators: the European Central Bank, the National Bank of Belgium, and the Financial Services and Markets Authority (FSMA).
This means that Belgian banks are well-organized and ready for the final stretch of Brexit. Their services will remain optimal, regardless of the scenario
