Treasuries prepare for no-deal Brexit
A no-deal Brexit scenario will cause serious hurdles for treasury teams over a variety of industries. After parliament’s no last week, The Global Treasurer writes an overview.
”Firms in the finance industry have put contingency plans in place to minimise disruption for their customers in a ‘no deal’ scenario but critical cliff-edge risks remain, including on the transfer of personal data and the operation of cross-border contracts,” said Stephen Jones, CEO of UK Finance, in a statement issued last Wednesday.
Catastrophy ahead, quite possibly
He is one of the industry voices quoted in The Global Treasurer’s summary of the situation after British prime minister Theresa May’s negotiated Brexit deal was voted down by parliament – and a confidence vote where she was lucky to escape being ousted.
According to Stephen Jones, a no-deal Brexit would be catastrophic for the UK economy, and time is running out to avoid it.
Treasuries get it in their lap
Treasury teams across many industries will meet serious hurdles if a deal is not struck soon, concludes The Global Treasurer. ”Unless lawmakers are able to reach some sort of compromise in the days to come, firms have little choice but to continue enacting their contingency plans,” it writes.
In a letter, published in The Times last Thursday, over 170 business leaders wrote to Britain’s two main parties begging them to return to voters with a second referendum.
Don’t bet it will solve
Yet, analysts at EY say the probability of a second referendum is low. They have now fixed the odds of a no deal scenario at one in five – the same likelihood as for a Norway-style deal or some form of hybrid customs arrangement.
Earlier in the week, PwC’s Head of Brexit issued a statement advising companies to “activate their no deal plans” immediately.