FRANKFURT, March 2 (Reuters) - Banks based in Britain seeking to do business in the European Union after Brexit will need to obtain local banking licences and establish actual operations on the continent, European Central Bank supervisor Sabine Lautenschlaeger said on Thursday.
“I do not see the ECB issuing banking licences to empty shell companies,” Lautenschlaeger, who sits on the ECB’s executive board, said in London.
“Our objective is to make the banking system safe and sound. I therefore expect banks which are seeking a licence in the euro area to meet our standards. There will be no race to the bottom in banking supervision,” she said.
Weighing in on the contentious issue of keeping euro derivatives clearing in the Britain, Lautenschlaeger said ECB consent would depend on whether the new framework would offer an unchanged level of involvement for the bank and whether the framework is strong enough to ensure financial stability in the euro zone. (Reporting by Balazs Koranyi; Editing by Robin Pomeroy)