More UK banks, financial advisers & investment institutions closing accounts for Brits in Spain.

By Tracy Storer

Senior Partner & Financial Planner

t.storer@chorusfinancial.es +34 693 107 044

As the UK moves into the ‘final chapter’ of their exit from the UK, facts are starting to become separated from fiction and finally we are starting to see through the mist and understand how our lives as expats will change in 2021.

Firstly, I want to re-iterate that Chorus have always taken a very sensible approach to Brexit. We only ever deal with validated facts, and there will never be any scare mongering from us. From the very early stages of the referendum until today, our communication have always been based on information that has been ratified by the British Embassy, and throughout this process we have kept a close relationship with the national group Brexpats in Spain and have supported the British Consulate on their seminar tours throughout Spain. One piece of advice that I always offer is to get information from the source, and if you haven’t already I encourage you to visit https://www.gov.uk/guidance/living-in-spain where you can find updated facts and advice about living in Spain.

So back to some of the changes that we might see come 2021… well you may have read recently that your UK bank accounts, investment providers or indeed UK based financial advisers will no longer be able to provide service to you post-Brexit. This is because of the use of ‘passporting’. Once a bank or financial services firm is established and authorised in one EU country, it can apply for the right to provide certain defined services in other EU countries. This pan-EU authorisation is its financial services ‘passport’, so service providers like your UK bank or your investment provider would have been able to continue to provide you with an ongoing service as they were using their UK regulation to passport into Spain.

Post-Brexit the UK will be considered as a ‘third country’ and under current EU passporting rules, firms incorporated outside the EU face significant regulatory barriers to providing cross-border banking and investment services to customers. To overcome these barriers financial institutions would likely need to establish an EU branch, and then apply for passporting from this branch to each country they wanted to provide a service in. This is how Chorus currently provide our service to clients across Europe, so we are fully set for a post-Brexit future, but it is very unlikely that a financial adviser in the UK would have the resources, or indeed justification, to do this for a handful of overseas clients.

As one example, this week UK-based Lloyds, Barclays and Coutts wrote to their customers based in the European Union confirming that those clients are likely to have their accounts closed. Speaking to International Adviser, a leading publication for finance professionals, a Coutts spokesperson advised “In the event that no alternative to the European Economic Area (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.”

As this is also the case for the vast majority of UK financial advisers, at Chorus we are getting regular requests from UK IFAs to take over advising their Spanish based clients. We’re happy that these responsible advisers are doing this now, rather than facing a cliff-edge, which could leave their clients without any adviser overnight.

If you still haven’t appointed a local adviser to your pension or investment, please feel free to give me a call on +34 693 107 044, email t.storer@chorusfinancial.es or complete the contact form to book a free, no obligation consultation.

Contact Tracy Storer