The Implication of Brexit on Single Banking Passport

Abstract

In the UK, nearly five-and-a-half thousand British companies hold passport under various Single Market directives, which means the authorized firms will have the power to provide certain regulated financial services in one European Economic Area (EEA) member state, and they do not need to obtain other EEA member state's separate authorization to provide certain regulated financial service. At the same time, nearly eight thousand companies from the EEA entered the UK with the passport. In addition to the UK and other EEA member states, many third countries' financial institutions that obtain single passport in the UK will inevitably be affected by the Brexit. It is not surprising that the change of passport power has attracted considerable attention. With the promotion of Brexit, the pattern of European banking industry will also change. The gradually differentiated regulatory environment will also become a big challenge for many large international banks. This paper aims to evaluate the impact of Brexit on the banking industry, specifically for many large international banks.