British banks to close EU residents’ investment accounts

Several British banks have confirmed that the accounts of investment or wealth management customers in France will close before 2021

30 November 2020
By Connexion journalist

Several British banks have confirmed the closures of accounts of customers in France before 2021, especially in investment or wealth management.

Some other banks, including Nationwide and the NatWest Group, are unable to rule out possible account closures as the UK and EU have still failed to agree a future relationship deal.

Even if an overall deal is signed, it is thought it might not contain sufficient measures on financial cooperation to satisfy some banks.

The end of the Brexit transition period on January 1 means the end of British banks’ right to “EU financial passporting”, which allows them to operate throughout the EU as easily as making transactions in the UK.

Banks will have to contend with domestic financial regulations in each EU country they wish to operate in

A Barclays spokeswoman said: “With regards to investments specifically, in September we began contacting our investment customers who are based in the EEA and advised that they will need to either sell their assets or move to another provider by December 4, 2020.” Private bank Coutts has also confirmed stoppages, saying: “In light of the fact that no alternative to the EEA 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.”

It said it was writing to clients who may be impacted so they have time to make alternative arrangements.

The accounts are expected to be closed before Christmas.

Another reader, who asked not to be named, contacted us concerning closure of his savings account at the Bank of London and the Middle East (BLME), which he said “comes as a huge blow”.

We are not aware of any other leading banks that are closing accounts.

Barclays’ credit card branch, Barclaycard, wrote to customers in the EU earlier in the year, saying their cards would be stopped by November 16 if they did not provide a UK address.

Barclays says it continues to review the services it can offer customers in the EU and will give as much notice as possible if further closures are necessary.

The Connexion reader Janet O’Brien said she was informed of the closure of her investment account, in which Barclays bought and sold unit trust investments for her.

She was told to sell the investments and transfer the money to her French bank account instead.

She said: “We feel very disappointed in the way that Barclays has treated customers in the EU. We can sell the product but it is something being forced on us and not necessarily at a time of our choosing."

“We feel the British government is very much at fault by not having the issue of banking for residents in the EU resolved long before now.”

Among other banks, HSBC said it was well-positioned to support customers in the EU and there are no changes in products and services.

Lloyds Banking Group, which includes Halifax and Bank of Scotland, has no current plans to stop any services or close accounts for members of the public who live in France. NatWest Group, which includes Royal Bank of Scotland and Ulster Bank, said: “NatWest have no intention of closing accounts unless there is no other option, and any customers who may be affected will be contacted. We’re keeping a close eye on the regulations and any deal that is reached.”

One reader emailed to say he was seeking to open a new UK account as his bank – Nationwide – had said closure of his account was “possible”.

A Nationwide spokesman told The Connexion it was so far only closing accounts of those in the Netherlands, due to regulatory problems there.

“It is unclear at present if we will be forced to close accounts in other European jurisdictions, and we want to avoid that outcome if at all possible. We’ll let members know as soon as we get further clarity from relevant regulators in each jurisdiction.”

Until the end of this year, an EU right to open a basic UK bank account from France at several banks remains in place. For more, search our website for “open a new UK bank account”.

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