LONDON — As Brexit trade deal talks between the U.K. and European Union go down to the wire, the financial and banking industry is nervously watching on.
Christian Sewing, chief executive of Deutsche Bank, told CNBC Wednesday that the lender was prepared for every eventuality when it comes to the last-ditch talks aimed at breaking the impasse.
Remaining differences between the two sides center on fishing rights, competition rules and governance of any deal.
“As a bank, you have to plan conservatively, we are prepared for a no deal, and hence it doesn’t change our view, it doesn’t change our strategy,” Sewing told CNBC’s Annette Weisbach as the bank held an investor day on Wednesday.
“We are prepared for each and every outcome,” he added.
The U.K.’s post-Brexit transition period ends on Dec. 31. If no agreement is reached then there is a no-deal scenario, where firms on both sides of the English Channel are likely to face higher costs of business — and exports could face tariffs.
Christian Sewing, Chief Executive Officer of Deutsche Bank, attends a session at the 50th World Economic Forum (WEF) annual meeting in Davos, Switzerland, January 23, 2020.
Denis Balibouse | Reuters
His comments come as British Prime Minister Boris Johnson prepares to travel to Brussels on Wednesday for a working dinner with European Commission President Ursula von der Leyen. Both sides have expressed their wish to strike a deal, but have acknowledged the outstanding issues make it difficult.
Sewing echoed the sentiment of many in the business community in both the EU and the U.K. — where British business groups have warned again on Tuesday that companies have not had time to prepare for the end of the transition period.
Leaders of industry, speaking to a government committee Wednesday, added that the country was likely to see disruptions to food and drink importing, higher car costs if levies are introduced, and a hit to the U.K. financial services industry.
Deutsche Bank’s Sewing said a no-deal scenario would not be good for the rest of Europe either.
“I think overall for Europe, and for the overall environment, a no-deal wouldn’t be a great outcome, we all know that,” he said.
“But most importantly, we are prepared for each and every outcome for our clients and that we can obviously deal with that and that’s the case. So preparation at Deutsche Bank has been done. Obviously we would favor a deal but, at the end of the day, this is not in our hands — we also have to plan also for the downside.”