Brexit: The Winds of Change

Thinking

Brexit: The Winds of Change

The vote is in and we now ask ourselves "what does this decision mean for the future of financial services in the UK?” 

To be frank, trying to look into the future to understand what Britain would look like post EU divorce is like trying to buy a bespoke suit online – Yes, you can visualise the materials and input what you hope are correct measurements, but you won’t know for sure how it fits until it arrives in the post and you try it on!

As a completely unprecedented situation the vote to leave could be considered a leap into the dark and a dive into uncertainty, but there could also be the opportunity to benefit from the Brexit decision.  Leaving the EU allows you to assess your business to see where you can obtain a competitive advantage.  Potential areas of opportunity include: 

  • M&A activity could increase as asset managers look to acquire businesses in continental Europe as an alternative to passporting;
  • Product managers can look at further horizons for distribution as necessity for diversification increases;
  • Products would no longer automatically be UCITs and could be re-branded as AIFs which could result in a relaxation of investment parameters whilst still being subject to FCA and EU regulations;
  • Opens up the need or opportunity to re-engineer company structures and operating regimes to allow continuation of services within the EU;
  • The ability to have more control over regulations which impact UK business;
  • A slump in the value of pound sterling will make UK funds appear particularly cheap and will open up other profit opportunities.

Knadel is a management consultancy which specialises in working with buy-side investment companies and who can help you identify your post-Brexit opportunities, review your opportunity plans and implement your change agendas.  We offer expert advice in:

  • M&A targeting and due diligence;
  • Product development and distribution strategies;
  • Regulatory interpretation for business benefit;
  • Target operating model redesign.

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By Karl Cranswick

Working within the Wealth Practice at Knadel, Karl is a consultant with extensive experience gained in both line and consulting roles. He has deep experience of outsourcing, having worked within the outsourcing industry as well as advising clients on outsourced arrangements as a consultant.

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