The tensions of Brexit have become daily fodder for Eurosceptics and EU enthusiasts alike — there seems often to be as much friction between UK ministers as between Britain and the EU27. One oasis of harmony has been the City of London, which has taken a methodical, orchestrated approach to what it wants from Brexit.
No more. Over recent weeks, the City’s view has begun to fracture, according to senior financiers: big banks in particular are no longer so keen on the long-advocated policy of seeking a post-Brexit system of “mutual recognition” between the UK and EU27.
The mutual recognition blueprint would give both sides freedom to devise their own financial rule books, but promise to recognise each other’s regulations, with disputes overseen by a third party adjudicator. The idea was floated by former City minister Mark Hoban in association with The City UK, the cross-sectoral finance lobby. And it soon became the de facto policy of both the Bank of England and the government.