(Bloomberg) -- The financial industry shouldn’t slow down its preparations for a potentially messy Brexit at the end of October, even if they’re already tired of the issue, European regulators said.
“Although there seems to be a ‘Brexit fatigue’ in the financial sector, supervisors continue to encourage institutions to prepare contingency plans for a no-deal Brexit and have themselves set further steps in motion to minimize negative impact on financial markets,” the three European Union financial authorities said in a joint report on Thursday.
The regulators -- including the European Securities and Markets Authority and the European Banking Authority -- said they observed a “slowing trend in Brexit-related authorization activities.” Firms may be postponing the relocation of their activities or re-opening discussions with regulators to scale down transfers, they said.
After the latest extension to the Brexit deadline, banks slowed down asset moves out of the U.K., people familiar with the plans said in June. The European Central Bank later warned them to move additional staff and resources to be ready in case the U.K. leaves the EU without an agreement at the end of October.
Regulators on both sides have taken measures to mitigate the most urgent risks to financial markets, but the EU has said it won’t take care of every problem arising from Brexit. A no-deal departure could still lead to “sharp corrections on financial markets, such as falling asset prices and rising risk premia,” the EU regulators said.
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