The APPG for Challenger Banks and Building Societies, which Barndoor Strategy provides the Secretariat for, has today published its comprehensive report on Post-Brexit Regulatory Reform.

The report issues a strong call to regulators and legislators to shake up the UK’s tired banking sector.  In its report on Post Brexit Regulation the APPG has made six key recommendations calling for more proportional regulation of smaller institutions and bolder action to cut red tape on building societies and challenger banks.

The APPG conducted its work during 2021 and received a wide range of responses from both regulators and from firms about the issues they face with excessive and overbearing regulation.  Competing banks in the US and the EU are subject to far lower regulatory requirements than UK firms, which is destroying the UK’s ability to compete in a post-Brexit world.

The Rt Hon Karen Bradley MP, CBBS APPG Chair commented:

“One of the most striking things about the UK banking sector is that if you travelled back in time 100 years to November 1921 you would find the same big four banking institutions dominating the UK market.  The UK has seen wars, recessions, the rise and fall of empires, yet the major UK banking institutions have stayed broadly the same.

“It cannot be right in the 21st Century that the same institutions which powered the UK during the smoke stack days of the industrial revolution are the best to take us forward in the digital age.  UK regulation has frozen competition and is holding our financial services sector back.  Ultimately, the UK’s overly centralised and disproportionately regulated banking system it is holding the UK back from competing on the world stage.

“The tragedy is that it is clear that both the Government and Bank of England recognise that all is not well with UK banking.  Now, post-Brexit, there is a once-in-a-lifetime opportunity to reform the sector and take the sort of bold action firms and trade associations have been calling on for years.

“Following on from the Chancellor’s corporation tax cut for challenger banks in the budget it is time for regulators to follow suit, seize the day and bring forward proportionate regulation.  For example regulators could look at a single threshold between systemic and non-systemic institutions say at £50bn which could be a focus point for higher regulatory requirements going forward from leverage to MREL, reporting, operational resilience and potentially even ring-fencing.”

You can read the full Post Brexit Regulatory Report on the APPG website at https://www.cbbsappg.org.uk/wp-content/uploads/2021/11/211122-CBBS-APPG-Post-Brexit-Regulation-Report-Web.pdf