Douglas Carswell

01 MAR 2016

The EU makes the City less competitive, and British banks less safe

Daniel Hodson, Jim Mellon, Neil Woodford. Top bankers and fund managers are debunking the Project Fear myth that Brexit would be bad for the City. Several are making the case that financial services will thrive without EU red tape. But there's another point we need to bear in mind too: EU rules don't just reduce profits; they threaten financial stability.

Ever since the financial crisis, the City has been firmly in the EU regulators' sights. "Quite right," you might think. "The banks caused the financial crisis. They need to be regulated."

Hold on a second, though. Yes, we need effective banking regulation. But who seriously thinks that's what the EU has given us?

Look at what's happening across the Channel. Last month, Deutschebank lost 40% of its value. The Eurozone is so dysfunctional that even ex-Bank of England governor Mervyn King can see it needs to be broken up, yet its leaders are pushing for still more integration. As our banking paper pointed out, the EU rules that were meant to prevent another financial crisis actually stop member states introducing higher capital requirements to keep their banks safe.

Instead of making the City more secure, EU regulation only makes it less competitive. It gives us the worst of both worlds.

In reality, much of the regulation is written to benefit big banks at the expense of smaller ones. It's no surprise that the firms that can afford an army of lobbyists to write the rules favour the status quo. But many others disagree. I know from when I worked in fund management that a lot of investors see not just the gains from leaving the EU, but the risks of staying.

We can't trust Brussels to manage our banks. Let's vote Leave, and take back control.

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