The boss of Britain's banking lobby thinks Brexit is like playing 'four-dimensional chess'
Speaking at Bloomberg's UK Investment Day on Monday, British Bankers' Association (BBA) boss Anthony Browne said that the huge number of variable issues that could impact negotiations, means the government is going to face a near herculean challenge to successfully leave the EU.
"Brexit is not just like three-dimensional chess, but four-dimensional chess," Browne told a crowd of investment managers, bankers and economists, adding that everyone involved in Brexit, including the BBA, is on a "journey of discovery."
The phrase "three-dimensional chess" is often used to describe complex procedures and negotiations with multiple layers, but Browne doesn't think that goes far enough, adding a whole extra dimension to his metaphor.
Besides the obvious issues that are muddying the waters of Brexit - like single market access, the free movement of labour, and EU budget contributions - Browne says the future shape of the European countries Britain will be negotiating with is a key factor in complicating things.
With Italy's upcoming referendum threatening to dethrone Prime Minister Matteo Renzi, along with elections in both France and Germany coming soon, the political landscape on the continent is more uncertain than it has been in many years. "
"We don't quite know the shape of what we're negotiating with," Browne said, pointing to the fact that both the French president and German chancellor - probably Europe's two most powerful roles - could change between Britain triggering Article 50 and formally leaving the EU two years later. That's going to make the fiendishly complicated negotiations even more difficult.
Given his role in promoting the interests of Britain's banks, Browne unsurprisingly turned to the impact Brexit could have on the sector, particularly with regards to financial passporting. The BBA is furiously having "endless talks with everyone about everything," he said.
"All the banks that have any operations across Europe are doing contingency planning. Their red line is that they need to keep serving their customers the day after Britain leaves the EU," Browne added, saying that if this criterion is not met, this is when banks could up sticks and leave the UK.
Previously, Browne has warned that bank bosses have their hands "quivering over the relocate button." He gave the warning in an opinion piece in the Observer newspaper. Here is the key section (emphasis ours):
"But businesses can't wait to the last minute. It takes years to move operations. Banks might hope for the best but have to plan for the worst. Most international banks now have project teams working out which operations they need to move to ensure they can continue serving customers, the date by which this must happen and how best to do it. Their hands are quivering over the relocate button. Many smaller banks plan to start relocations before Christmas; bigger banks are expected to start in the first quarter of next year."