A.M. Best has said that measures it has implemented to prepare for a post-Brexit environment will apply irrespective of the UK’s ability to reach a trade with the European Union (EU) by December 2020.
Like many other global organisations within the UK financial services sector, ratings agency A.M. Best has taken a number of steps to ensure continuity post-Brexit.
This includes the establishment of a new Amsterdam subsidiary announced in December 2018, and securing credit rating agency registration with the European Securities Markets Authority, effective December 3rd, 2018.
The new entity, A.M. Best Rating Services B.V., enables the company to continue to provide ratings for EU domiciled clients and will be used for regulatory matters post-Brexit across remaining EU member states.
A.M. Best Europe – Rating Services Limited, the company’s London-based operation, will become registered with the Financial Conduct Authority as at the end of the transition period, which enables the unit to continue to provide ratings for UK regulatory purposes.
“In practical terms, clients should experience no changes. AM Best will be able to continue providing credit ratings that can be used for regulatory purposes in both the United Kingdom (UK) and EU post-Brexit,” explains A.M. Best.
The ratings agency adds that it plans to endorse ratings produced in the UK into the EU and vice versa, and where permitted, it will also endorse ratings from other non-EU/non-UK A.M. Best offices in accordance with the regulatory provisions.
Regarding Amsterdam as the choice of domicile, the firm says that the city is a well-established financial centre that meets its strategic priorities, while offering transportation links to important locations across Europe.
Interestingly, A.M. Best notes that in the instance the UK fails to reach a trade agreement with the EU by the end of December 2020, all of these arrangements will still apply.
