23 January 2019 
Karel Thomas, Executive Director
Whether the UK agrees a withdrawal deal with the EU, walks away without a deal, or comes to the conclusion that the treatment is no longer appropriate for the condition that was diagnosed in 2016, Treasury Managers should be making (or have made) plans and decisions. Most of the banks used by universities have some helpful advice on their websites – HSBC has a Brexit Hub with much of the information freely available to the public, and their Treasurer’s checklist is excellent. Lloyds Bank also has a Brexit Resource Centre and Barclays are also very supportive of their customers who need all the help they can get finding their way through uncertainty. We asked all three banks “will the UK still be able to participate in SEPA if there is no deal?”, and all told us that they anticipate the UK will continue to be able to use SEPA, which is a relief if you do many Euro transactions. However, all the banks have other payment solutions if we are drummed out of the system.
As for currency risks with student fees, universities usually price in GBP so the currency risk is passed to the student, although beware the effect on recruitment if there is significant strengthening of the pound. Some EU grants (and other Euro denominated grants) will still be paid to universities after Brexit and as with grants in other currencies, universities should explore options to mitigate movements in sterling that means a project’s costs are mismatched with its income. Treasurers should make sure they are talking to their banks about exposure to currency movements and discuss options to manage it, whether that is GBP/EUR, GBP/USD or any other pairing. Barclays has just published a short case study of how they have helped the University of Sussex, which is an instructive read, especially if currency management is a small part of your job.
