The London Stock Exchange is executing its contingency plans for a hard Brexit, amid growing uncertainty a deal can be struck in time.
The firm this morning reported a 21 percent rise in first-half adjusted operating profit to £480m - more than £20m ahead of consensus estimates - as its clearing, capital markets and information services businesses grew strongly.
But in a statement the company said the UK’s final exit terms were “still unclear”, noting a final agreement had to be signed off “by a number of bodies within both the UK and EU, and cannot be relied upon at this stage”.
The white paper clarified the UK’s position but there still remain “several issues to be resolved with the EU or risk a ‘no deal’ scenario”, the LSE said.
“Any of these effects of Brexit, and others the group cannot anticipate, could adversely affect the group's business, results of operations, financial condition and cash flows," it said.
“The group is executing contingency plans to maintain continuity of market function and customer service in the event of a hard Brexit. These contingency plans include incorporation of new entities in the EU27 and applications for authorisation within the EU27 for certain group businesses.”
It noted that the lack of clarity around the ultimate end state could “decrease the effectiveness, or applicability of some of these contingency plans”.
It added that the group’s key objectives were to maintain “London’s position as a global financial hub and providing continuity of stable financial infrastructure services”.