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FINANCE

Sweden to bolster banks against European debt crisis

Swedish Finance Minister Anders Borg said Tuesday the Scandinavian country was putting in place measures to protect its finance and banking sectors from being sucked into the European debt crisis.

“More money for financial inspection, better control, strengthened protection of deposit guarantees and changes to the banks’ capital reserve requirement rules,” are some of the measures the centre-right government aims to quickly put in place, Borg wrote in an opinion piece in Sweden’s daily of reference Dagens Nyheter (DN).

The commentary was co-signed by Swedish Finance Market Minister Peter Norman and chair of the parliamentary finance committee Anna Kinberg Batra.

It appeared as Borg was preparing to attend an extraordinary meeting of the parliament’s finance committee called to discuss the expanding crisis in global financial markets.

“Sweden, which has a small, open economy, will be affected,” they wrote, adding “how much will depend on our capacity to ensure that effective measures can protect employment and welfare against the sometimes crazy affects of the debt crisis.”

They stressed nonetheless that Sweden, which counts one of the strongest economies in the European Union, has a financial system “considered to be stable.”

On August 11th, Borg cautioned that Sweden would be affected by the growing debt crisis, warning that the country’s strong growth forecasts for next year would be revised down.

In next month’s budget proposal, the centre-right government also aims to push for “extra resources for inspecting financial markets,” Borg and his colleagues wrote.

They pointed out that “the latest stock market trouble shows how the banks with a lot of debt can quickly find themselves in trouble.”

Ahead of Tuesday’s parliamentary meeting, Borg meanwhile cautioned to the TT news agency that Sweden is facing “a difficult autumn ahead.”

“We will surely have periods when the markets are little calmer … but since the basic reason for the tensions will remain I think the autumn will be long and difficult,” he warned.

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BREXIT

Brits in EU risk losing UK bank accounts ‘within weeks’

Some of Britain's biggest banks have begun contacting customers in European Union countries, warning them that their accounts will be closed down within weeks because the cost and complexity of operating without a continuation of pan-European banking rules is too much.

Brits in EU risk losing UK bank accounts 'within weeks'
Lloyds Bank expects to close at least 13,000 accounts. Photo: Lloyds Bank
According to a report in The Times, thousands of Britons who live in Europe face being stripped of their UK bank accounts and credit cards, because of the UK government's failure to agree rules for operating after Brexit. 
 
Each of the EU's 27 member states has different rules for cross-border bank accounts which will start to apply immediately the UK's transition period ends on 31st December 2020. 
 
“In some cases, continuing to serve customers would be incredibly complex, extremely expensive and very time-consuming, and simply would not make economic sense,” a source at one British bank told the newspaper. “This is passporting — this is the reality of Brexit.”
 
 
If a way is not found to continue pan-European banking rules, or passporting, UK banks will br breaking the law if they don't apply for new banking licenses in each European Union Country. 
 
 
Lloyds, Britain’s biggest banking group, began writing to customers in August, warning them that their bank accounts would  close down on December 31.
 
The bank estimates that 13,000 customers, including those based in Holland, Slovakia, Germany, Ireland, Italy and Portugal, would lose their accounts. 
 
“If customers have regular deposits into, or payments out of, their account, they will need to make other arrangements before their account is closed,” the bank said. 
 
Barclays and Coutts have also started contacting customers. 
 
“In light of the UK leaving the EU at the end of 2020, we continue to review the services we offer to customers within the European Economic Area (EEA), and any impacted customers will be contacted directly,” Barclays said in a statement. “The timings for account closure will depend on the type of product that a customer holds, but we will always give notice to customers.”
 
“In the event that no alternative to the European Economic Area passporting regime for financial services is agreed between the UK and EU, we have taken the difficult decision to withdraw from offering our services to clients who reside in the EEA,” Coutts said. 
 
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