CLEARING HOUSES EQUIVALENCE DECISIONS POSSIBLE BY JUNE

Steven Maijoor, the chair of the European Securities and Markets Authority, told reporters yesterday that ?from a technical standpoint [it] is possible? for the regulator to decide, before the effective deadline of June 2020, whether UK-based derivatives clearing houses can continue to serve EU-based clients after the end of the Brexit transitional period (Reuters, online only).

However, Maijoor cautioned that UK financial services firms? access to the EU market will depend on the outcome of the political negotiations over the UK's future relationship with the EU.

The Daily Telegraph (£, online only) reports that the City agrees with the comments made by the governor of the Bank of England earlier this week that the UK should seek to retain autonomy over its regulatory regime while preserving equivalence with the EU. Commenting in the Telegraph, UK Finance's CEO, Stephen Jones, emphasised the need 'to build a clear institutional mechanism for regulatory dialogue as well as maintaining a strong voice at a global level to influence standard-setting bodies key to the industry?.

Meanwhile, the House of Commons voted yesterday to approve at third reading the EU Withdrawal Bill, which will give domestic legal effect to the UK's scheduled withdrawal from the EU on 31 January (BBC News, online only). The Bill will be considered by the House of Lords next week.

BANK OF ENGLAND GOVERNOR HINTS AT INTEREST RATE CUT

Speaking yesterday, the governor of the Bank of England, Mark Carney, hinted at the central bank's preparedness to further cut interest rates in response to a potential slowdown of the UK economy. The governor said that ?if evidence builds that the weakness in [economic] activity could persist, risk-management considerations would favour a relatively prompt response?. Carney also remarked that there was an ?open question? as to whether the UK's monetary policy framework 'should be adjusted to embed a commitment to hold rates lower for longer? (Financial Times, £, p2).

NEWS IN BRIEF

The Guardian (online) is one of a number of newspapers to report on the FCA's proposals, announced yesterday, to introduce a single rate for all easy-access cash savings accounts.

The number of financial technology firms based in Scotland has risen by 60 per cent over the last year, according to new figures from FinTech Scotland (BBC News, online only).

The Financial Times (£, online only) reports that the Foreign Office will next month activate a new ?human rights-based? sanctions regime, using so-called ?Magnitsky powers? to freeze the assets of foreign nationals deemed responsible for human rights abuses.

Dixons Carphone has been fined £500,000 by the Information Commissioner's Office after a cyberattack which compromised the sensitive personal data of at least 14 million people (The Times, £, online only).

Household debt has hit a record high of more than £400 billion, according to a report by the Trade Unions Congress (Metro, p9).

Regulations implementing the Fifth Money Laundering Directive in the UK come into force today (Companies House).

WHAT THE COMMENTATORS SAY

In City AM (p21), Deborah O'Neill, the UK Head of Digital at Oliver Wyman, argues that it is incumbent on both firms and regulators to ensure that exciting digital innovations, including the application of artificial intelligence in lending decisions, do not fall foul of data privacy and data ethics standards. To this end, O'Neill welcomes draft guidance from the Information Commissioner's Office on how firms ought to explain to customers the decisions reached by artificial intelligence. 

LATEST BLOGS

Simon Hills, Director of Prudential Regulation at UK Finance, blogs on climate change stress testing and how the scenarios could play out.

LATEST VIDEOS

Katy Worobec, Managing Director of Economic Crime at UK Finance, looks ahead to February's Economic Crime Congress.