This month we saw two key speeches on Brexit, from the Prime Minister and the Chancellor. The logic on financial services was pretty clear – that although the UK was going to leave the single market, it still expected the kind of bespoke deal on financial services that was offered to the US and Canada, which would have allowed for a great deal of mutual recognition. As Hammond summed it up: “If it could be done with Canada or the US... it could be done with the UK.”

The problem with comparing the UK to the US and Canada is that although the UK’s system of financial regulation is undoubtedly closer to the EU than either of the North American countries, the UK is headed in a different direction.

Canada and the US (at least at the time of the TTIP negotiations) were heading towards greater convergence with the EU. The UK is heading away from harmonisation of regulatory regimes, and that may speed up if the EU presses ahead with a different agenda – for example, on the introduction of a transaction tax.

Where there is a tendency for the regulatory approaches taken by different countries to diverge, there has to be a mechanism to ensure that one of them doesn’t cash in on the advantages that come with mutual recognition while at the same time ‘dumbing down’ regulation in order to attract investment. At the moment, at EU level this mechanism takes the form of auditing and approving countries for ‘third country’ status – and the EU will be unwilling to invent an alternative process just for the UK. However, as Hammond made clear in his speech, it’s difficult to see the UK being able to stomach regular audits in order to be allowed to do business with key trading partners.

So there are still a lot of unanswered questions around financial services and mutual recognition, which is perhaps why in a survey published by the CII this month, our members told us that they consider Brexit to be the biggest risk to the profession (30%) followed by cyber security (21%).

However, as a profession we do not have to be helpless spectators to a long, drawn-out diplomatic process. We can build trust across borders by creating our own track record of client focus and ethical behaviour. If we do that, concerns about a regulatory ‘race to the bottom’ will gradually fade away.

The challenge for financial services professionals in the UK is to turn Brexit from our biggest risk into a global opportunity, by demonstrating the value of the UK to consumers across the world, regardless of the formal regulatory structure we find ourselves in.

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