Business

Nick Goodway: Brexit task force has this German elephant in the room

Nick Goodway: There is something bizarre about Xavier Rolet being the person on Shriti Vadera’s task force, working out the City’s response to Brexit
Anne-Christine Poujoulat/AFP/Getty Images
Nick Goodway
19 August 2016

There is something bizarre about Xavier Rolet, chief executive of the London Stock Exchange, being the person on Shriti Vadera’s task force, working out the City’s response to Brexit, advising it on access to capital markets.

After all, Rolet is a Frenchman, a committed European and is in the process of selling his business to Deutsche Börse in a £22 billion deal.

I cannot disagree with his remarks to the Financial Times, where he said: “European companies large and small as well as governments rely heavily on access to the UK financial services sector and the work of this committee is to look at the impact of the sector on the real economy.”

But surely Rolet is conflicted.

The committee is working on how different areas of London’s financial sector can achieve passporting post-Brexit to ensure that services and products from the City can continue to be sold across Europe.

Read More

WH Smith hire turnaround veteran with package that could be worth £25m

WH Smith hire turnaround veteran with package that could be worth £25m

Blue Posts boss: If opening a pub becomes so risky, people just won't do it

Blue Posts boss: If opening a pub becomes so risky, people just won't do it

Culpeper pub boss: Rates system is not fit for purpose — and not fair

Culpeper pub boss: Rates system is not fit for purpose — and not fair

Sponsored
The best destinations and activities to book this winter

The best destinations and activities to book this winter

The likelihood is that this will be done sector by sector rather than through a single, all-encompassing access agreement.

Access to capital markets is one of the cornerstones of the City and one where it undoubtedly has a beneficial effect on the real economy of Britain. Rolet has spent much of his seven years in charge of the Stock Exchange campaigning relentlessly for a fair playing field between equity and debt.

Which makes it all the more strange that he is on the Financial Services EU Task Force batting for the City while the elephant in the room is Deutsche Börse.

Whatever promises the Germans have made about having the headquarters in London, we all know, particularly post-Brexit, the engine room and the bulk of the work will eventually end up in Frankfurt.

Shareholders of both firms have overwhelmingly backed the deal so it is now up to politicians and regulators to scrutinise and potentially block it.

Chancellor Philip Hammond, Bank Governor Mark Carney and Financial Conduct Authority chief Andrew Bailey must be absolutely certain that losing ownership of the UK’s stock exchange will do no damage to the real economy if they are to wave it through. If they have the slightest doubt they should block it now.

Will Hills now turn tables in bid race?

It is unusual to see shares in a bid target rise 5% the day after the bid fails. But that’s what happened to William Hill’s shares today.

Punters are convinced that consolidation will continue in the gambling market and that Hills will be part of it. The only question is how soon will the hunted become the hunter?

MORE ABOUT

Brexit
Comment