Data taken from a poll of 138 senior management representatives from financial services firms with business interests and/or a presence in the UK market in July 2020
- Almost three quarters (72%) of respondents do not think a financial services (FS) trade deal will be in place between the EU and the UK by 1st January 2021
- Even so, only 6% of firms claim to be fully prepared for a no financial services trade deal
- Almost a quarter (22%) believe a significant number of actions still need to be undertaken to remain operational in the event of a no trade deal scenario, while 72% believe a minor number of actions are required
- With remote working now more common due to COVID-19, respondents were split on the extent to which they have Brexit-proofed cross-border remote work policies, risk controls and governance effectively in place:
- Almost a quarter (24%) confirmed they will not enable cross-border remote work for their employees
- Whereas 26% confirmed they do not have Brexit-proofed cross-border remote work policies, risk controls and governance in place, but that they are looking at this issue
- Over a third (37%) have policies in place to a limited extent and are operating on a case by case basis for employees
- Only 13% of respondents said that they have these policies in place to a significant extent
John Liver, UK Financial Services Partner at EY, comments: “While data from our EY Financial Services Brexit Tracker suggests that firms reached peak preparation in 2019 ahead of a potential no-deal Brexit, the most recent sentiment from senior management across the financial services industry indicates that action still needs to be taken to ensure they remain operational in the event of no trade deal for financial services being in place by the end of the year.
"The relative silence around Brexit-related relocation plans from financial services companies since January should not be mistaken for firms having everything in order. Uncertainty around the outcome of the EU-UK negotiations and some important financial services equivalence decisions are causing increasing concern across the City. For firms that haven’t yet finalised their plans for a no-deal exit, a frank assessment of what changes may still need to be implemented to avoid a hard landing at the start of January 2021 is becoming increasingly critical."