The chief executive officer of the London Stock Exchange has said he expects the EU will permit its banks to carry on clearing trades through London.
David Schwimmer said the LSE is negotiating with the bloc and clients to resolve the issue of what clearing arrangements should look like in the long-term post-Brexit – one of the biggest outstanding issues for cross-border markets since the UK made its exit.
Although institutions within the EU can currently use LCH and other UK clearing houses thanks to a temporary waiver that expires next July, the two sides are yet to agree on a long-term plan.
“My expectation is that the European Commission will find a way to continue allowing EU-domiciled member banks and other institutions to continue to access LCH,” Schwimmer told Bloomberg, who first reported the news.
“It’s clearly recognised that it is a critically important service for the EU institutions who are using it, so it would be bad for them if they were cut off from it.
“We’ll continue to engage with the various stakeholders. I expect we’ll see something probably early in the new year,” he added.