Brexit

Fed’s stability checkup downplays wobbly features

28 Nov 2018

Chairman Jerome Powell says the financial system is in good health, echoing a report from the U.S. central bank. The jobless rate is low while inflation remains in check. But risks like trade fights and corporate debt only get brief mentions. Watchdogs may regret that posture.

Bank of England hurls a lifebelt to UK Brexit plan

28 Nov 2018

The UK central bank has warned domestic GDP could fall 8 pct in a disorderly Brexit scenario. A deal more akin to the state’s exit plan could lead to a 0.75 pct dip. That helps Prime Minister Theresa May’s deal, but maybe not enough to get it through parliament.

Thomas Cook epitomises Brexit cliff-edge risk

27 Nov 2018

The UK travel operator gave a second profit warning in two months. Foreign bookings hit by a hot summer aren’t the issue. Rising leverage, a suspended dividend and an outlook that depends on strong consumer demand are – and will stay bad until Britain’s EU exit is clarified.

Brexit vote plan is more twerp than TARP

23 Nov 2018

Market panic helped the U.S. government push its 2008 bank bailout through Congress. Theresa May might hope for a similar outcome if the UK parliament rejects her deal to leave the EU. The flawed analogy misunderstands markets, and forgets that Britain’s crisis is self-inflicted.

Viewsroom: What’s next for Brexit?

21 Nov 2018

Cabinet resignations, an angry coalition partner and a skittish currency greeted UK Prime Minister Theresa May’s draft agreement to quit the EU. Breakingviews columnists examine whether the current mess leads to Brexit with an EU deal, without a deal, or even to a new referendum.

Hadas: Dumb ideas undermine Brexit and Facebook

21 Nov 2018

Freedom is simple. History is on our side. Fantasy is safe. These simplistic quarter-truths helped pitch Britain into a political crisis, and encouraged the social network to ignore a slew of warning signs. Sadly, the damage done by weak thinking is hard to undo.

Watch UK bonds to see when there’s a real crisis

16 Nov 2018

The pound suffers every time concern flares that Britain may crash out of the European Union. But gilts strengthen since bleaker economic prospects make higher interest rates less likely. The clearest sign investors have had enough would be when both weaken at the same time.

Rates pain compounds UK banks’ Brexit misery

16 Nov 2018

Shares in British lenders fell after government resignations increased the chances of Britain failing to agree a deal with the EU. Investors are pushing back hopes for higher interest rates. That leaves banks stuck with low margins on top of political and economic uncertainty.

UK government turmoil hardens Brexit dilemma

15 Nov 2018

Two cabinet ministers have quit, weakening Prime Minister Theresa May and reducing the already-slim chances that parliament will support her deal to leave the European Union. That makes the alternatives of a painful and chaotic Brexit, or a second referendum, more likely.

Brexit compromise confirms Britain’s hard choices

14 Nov 2018

Prime Minister Theresa May’s draft deal would bind the UK to the EU without the benefits of membership. Even if her cabinet backs it, parliament may not. Opponents have two options: crash out of the bloc next March, or call another referendum. The fight will only get more bitter.

EU bank stress test is Brexit war by other means

2 Nov 2018

The EBA’s adverse scenario hits Barclays and Lloyds worse than other euro zone lenders. A projected UK economic hit deeper than euro zone peers helps explain why. EU stress tests are always political, and this one can be read as a coded warning against a messy UK exit.

Sterling appreciates Brexit deal more than bankers

1 Nov 2018

Britain may be close to securing a deal that would give London basic access to EU financial markets. That’s boosted sterling but offers limited cheer to banks. Such an accord would fail to cover many banking services and force an alignment with rules over which the UK has no say.

New BT boss will be hostage to Brexit fortune

1 Nov 2018

The telecom company’s success at tempting clients to buy pricier connections is lifting revenue and profitability. The strategy may unravel and its pension deficit widen if Britain exits the EU without a deal. Incoming CEO Philip Jansen would then have to cut more costs quickly.

UK exploits fiscal good luck while Brexit allows

29 Oct 2018

Finance minister Philip Hammond plans to control the deficit while spending more on health, defence and schools without big tax hikes. Economic serendipity allows him to. A messy EU exit would end a run of good fortune, since he has used up much of the windfall that came his way.

RBS sends not-so-subtle warning on hard Brexit

26 Oct 2018

The state-owned UK lender’s 100 mln pound provision to cover the risk of a messy UK exit from the EU is trifling given its loan-book size. Yet private UK banks have taken the same step less noisily. A decade after it was rescued, RBS still wears its public embrace uncomfortably.

Lloyds offers shareholders a binary Brexit dare

22 Oct 2018

The UK bank may buy back 2 billion pounds-worth of stock next year, according to the Financial Times. That could boost annual returns to nearly 15 percent and justify as much as a 40 pct boost to Lloyds' share price – as long as the UK can avoid a messy split from Europe.

Brexit impasse moves UK and EU closer to abyss

18 Oct 2018

With five months to go, Prime Minister Theresa May still can’t come up with a plan that satisfies the European Union and hard-line parliamentarians. To avoid a chaotic Brexit, at least one side must cave. That won’t happen until the disastrous alternative gets even closer.

Unilever bows to corporate version of Brexit revolt

5 Oct 2018

The Anglo-Dutch group ditched a vote to move its head office to the Netherlands after UK shareholders rebelled. The saga shows the limits of the special treatment that large multinationals can ask from politicians. It also demonstrates what investors can do when they join forces.

Europe’s IPO investors get Brexit present

4 Oct 2018

Companies are rushing to list while stock-market valuations are rich and before Britain crashes out of the EU. The deluge means bankers have to price offerings modestly, and investors can afford to be picky. Hairier issuers, like Aston Martin or Funding Circle, face a bumpy ride.

Drug watchdog’s Brexit spat is bad omen for London

25 Sep 2018

The European Medicines Agency is embroiled in a legal fight to scrap a lease on its UK headquarters. Its argument, that Brexit was an unforeseeable event, looks weak. But even if the regulator loses the case, its actions offer a grim prognosis for London office property.