Challenger banks to hold first post-Brexit Treasury talks

The heads of the UK's ‎leading challenger banks will this week renew calls for ministers to ease tax and regulatory burdens on the sector when they hold their first talks at the Treasury since George Osborne's sacking as Chancellor.

Sky News understands that the bosses of lenders including Aldermore, OneSavings Bank (Stuttgart: 2OS.SG - news) , Secure Trust Bank and Shawbrook‎ will meet Simon Kirby, the City Minister, on Monday.

The bank chiefs will press the case for the Government and City regulators to prepare what they regard as a more proportionate approach to the treatment of smaller banks and building societies once the UK leaves the European Union.

They were also furious last year when Mr Osborne imposed a corporation tax surcharge on the industry, with their pleas to be excluded from it falling on deaf ears.

Some of the challenger banks believe that with Mr Osborne having been replaced by Philip Hammond, the Government may be prepared to do more to assist them as they seek to make inroads into their larger peers' dominant market share.

Theresa May said in her speech to the Conservative Party conference‎ last week that she would seek to repair markets which were "broken", although she did not explicitly refer to banking.

Treasury officials are said to have requested more data‎ from challenger banks in recent weeks following their complaints about the onerous capital requirements they face.

A Competition and Markets Authority inquiry into the industry was criticised by smaller banks in June for failing to propose sufficiently radical reforms.

An overhaul of the way the buy-to-let lending market is regulated has also ‎caused concerns among investors in challenger banks, which have seen sharp falls in their share prices since June's referendum.

In a letter to Andrew Tyrie, who chairs the Treasury Select Committee, a week after the EU vote, the chief executives of seven challenger banks wrote that they sought "neither favours nor any special treatment".

"All we ask for is a level competitive playing field.

"This will allow normal competitive forces to apply which over time should lead to greater diversity across the whole of the UK banking market.

"We believe this has clear societal benefits and is in the best interests of the UK economy, consumers and SMEs."

The bosses added that with much of the UK framework for regulating banks dictated from Brussels, the EU referendum result "should allow the Government to determine its own strategy for the regulation of banks".

"We believe it would be helpful for the CMA to take account of the referendum outcome and provide firm recommendations for HM Government to take in a post-Brexit environment," the June letter said.

The boss of one challenger bank cautioned on Sunday that ‎"any levelling of the playing field will take time and will be part of the wider Brexit negotiations".

The Treasury declined to comment.