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Tuesday 20th October 2020
Home Articles No deal Brexit strips expats of UK bank accounts

No deal Brexit strips expats of UK bank accounts

Thousands of Britons living in the EU will have their UK bank accounts closed by the end of the year because of the UK’s failure to agree a post-Brexit trade deal.

Statement from the British High Commission, Nicosia:

“Some of our UK nationals in Cyprus may have seen recent media coverage about some UK banks’ decision to close accounts belonging to EU/EEA residents, and we wanted to share the latest information.

Whether UK banks can service EEA-based customers after the end of the UK Transition Period is a matter of local law and regulation in each country, and may be impacted by how firms are set up and what steps they have taken to continue to serve customers. We expect UK banks to comply with the law at all times.

If you are affected, your provider will contact you directly.

As we are unable to provide any financial advice, you should contact your bank or an independent financial adviser if you have any questions.

More information is available from the UK Financial Conduct Authority here: https://www.fca.org.uk/consumers/how-brexit-could-affect-you.”

Statement ends

UK Bank accounts closure: further reading

The TimesBrexit strips expats of UK bank accounts

The GuardianThousands of Britons living in EU told their UK bank accounts will be closed

Daily MailTens of thousands of British expats in Europe ‘will be stripped of their UK bank accounts and credit cards in weeks’ after government failed to negotiate post Brexit rules

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2 COMMENTS

  1. Re the closure of UK bank accounts of expats living in some EU countries.There appears to be much confusion and concern by many. Is it possible to obtain any guidance from the British Consul as to if passporting of UK banks with Cyprus has or will be agreed.

    Presumably such arrangements were in place prior to the Formation of the EU?

    The banks are not able to clarify their position currently. It is not clear why some have taken action before negotiations have concluded.

    It is very possible that customers will have insufficient time to take action.

    Many thanks

    • Banks have taken actions which are in their commercial interests and will continue to do so. Some have adopted a structure which means they can continue to service customers resident in EU/EEA while others have concluded it’s not worth their while to do so. My understanding is that a proper EEA subsidiary could operate throughout the EEA (by virtue of being ‘passported’) while a UK bank establishing authorised branches in individual countries would allow independent operation within each of those countries (not ‘passported’). In either case it would cost millions to change for any specific bank which isn’t already structured appropriately. Financial services such as brokers can probably be expected to face the same decisions.

      The photo heading the article features Barclays but that may be among the less prominent banks in this disruption as some will remember 2015 when the Cyprus operation of Barclays decided to close accounts of those with deposits less than €100k and transfer the accounts of higher net-worth individuals (well, those who opted to stay with them) to their Corporate & International operation in London. Obviously that wasn’t Brexit-related but simply a commercial decision for Barclays due to a changing business environment. Same now – commercial decisions by banks are taken because the world changes.

      I gather that many people resident in the EU have not informed their UK banks of their current residence but have allowed a UK address to remain on file with the bank(s) for correspondence purposes (along with a UK mobile number for OTP and the like). I would hope they don’t apply for ISAs or apply to open new bank accounts or attempt other acts forbidden to non-residents or, of course, do anything that might allow their non-UK address to leak into their Credit Reference Agency (CRA) files in the UK.

      Many of those already identified (to their bank and in their CRA files) as not resident in the UK may now find themselves snookered – without sterling accounts and not eligible to apply for UK bank accounts – but perhaps some of the FinTech providers may plug some gaps. Again, some require applicants to be UK resident so can’t be considered but others provide some forms of sterling account services. ‘Do your own research’ with great care and check all the details rather than assume you’ll enjoy the same guarantees, compensation schemes and tariffs that you may be used to.

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