Banking After Brexit: What Changed for British Expats in Europe

Brexit reshaped the banking landscape for British expats in Europe in ways that were not fully anticipated at the time of the 2016 referendum, and the practical consequences played out gradually over 2019–2022 as regulatory changes took effect. For those who went through the experience of having their UK bank write to inform them that their account was being restricted or closed, it was a significant and often stressful disruption.

In 2026, the picture has stabilised, and workable solutions exist. But understanding what happened, why, and what the enduring implications are helps British expats in Europe make better decisions about their banking structure.

What the EU financial services passporting regime was — and why Brexit ended it

Before Brexit, the UK's membership of the EU meant that UK-regulated financial institutions had automatic "passporting" rights across the EU. A bank, insurance company, or investment manager regulated by the FCA in the UK could offer its services to customers in any EU member state without needing separate regulatory authorisation in each country. The reverse also applied: EU-regulated institutions could serve UK customers.

This passporting regime was the foundation of the UK's position as a financial services hub — it enabled UK banks to operate across 27 countries from a single UK regulatory base. For individual British expats in Europe, it meant their UK bank could, in theory, continue to serve them regardless of where they moved within the EU.

When the UK left the EU on 31 January 2020 (with the transition period ending 31 December 2020), passporting rights were lost. From 1 January 2021, a UK bank wishing to serve customers in France needed to be separately authorised by the French regulator (Autorité de contrôle prudentiel et de résolution). Similarly, a UK-based investment manager could not automatically serve EU clients.

Most UK banks did not obtain separate EU regulatory authorisations for retail customers — the commercial economics simply did not support it for the retail banking market. The result was a wave of letters to EU-resident customers advising them that their accounts would be restricted or closed.

What actually happened: bank by bank

The pattern was uneven and evolved over time:

HSBC announced restrictions on UK accounts held by EU residents in some markets. HSBC Premier customers were generally better protected — the global Premier relationship gave some continuity — but ordinary HSBC UK account holders in some EU countries received closure notices.

Nationwide closed accounts for members living in the EU in certain circumstances. Building society membership rules added complexity.

Barclays restricted some services for EU-resident account holders. The situation varied by EU country and by account type.

Lloyds, Halifax, and Bank of Scotland also restricted or closed accounts for customers resident in certain EU countries.

Santander UK similarly restricted accounts for customers in some EU markets.

The pattern by country was not uniform. Some EU regulators explicitly prohibited UK banks from serving resident customers; others were more passive. France, Germany, and the Netherlands were generally more restrictive enforcement environments. Spain and Portugal were more permissive in practice. Cyprus, despite being an EU member, has a tradition of international banking that made the practical environment for UK expats somewhat less fraught.

Why Isle of Man and Channel Islands accounts were unaffected

The key fact that many British expats in Europe did not initially appreciate is that the Isle of Man, Jersey, and Guernsey are neither part of the UK nor part of the EU for financial services purposes. They are Crown Dependencies — separately governed territories with their own regulatory frameworks, which are not subject to UK financial services legislation and were never part of the EU single market.

This means:

• A bank regulated in Jersey (like HSBC Bank International Limited, which operates HSBC Expat) is not a UK bank — it is a Jersey bank
• Jersey has its own financial services regulator (the Jersey Financial Services Commission)
• There is no EU passporting issue because Jersey-regulated banks were never part of the EU passporting regime
• Jersey, Guernsey, and Isle of Man banks can serve customers resident in EU countries without needing EU regulatory authorisation

HSBC Expat, Barclays International (Isle of Man), and similar offshore providers were designed precisely for this situation — they serve internationally mobile clients who may be resident in many different countries, including EU member states. Brexit did not affect this model.

This is why offshore accounts in these jurisdictions represent the correct long-term solution for British expats in Europe, not a workaround or a temporary fix.

The current situation in 2026

Five years after the full implementation of Brexit, the banking landscape for British expats in Europe has largely stabilised:

UK-regulated banks continue to serve EU-resident customers on a restricted basis in many cases, or have found regulatory solutions in specific markets (for example, some banks have obtained local authorisations or use subsidiary structures). The situation varies by bank and by country — always verify with your specific bank.

Offshore accounts (Isle of Man, Jersey, Guernsey) have become the standard recommendation for British expats in Europe who need a stable, accessible savings and international banking account. HSBC Expat and Barclays International continue to serve EU-resident British expats without the complications that affect their UK-regulated counterparts.

EU-regulated digital banks — Revolut (Lithuanian banking licence) and Wise (Belgian EMI licence) — are fully accessible to British expats in all EU countries and remain popular for day-to-day multi-currency banking.

Local banking remains essential. A local bank account in your EU country of residence is practically necessary for local direct debits, utility payments, local tax payments, and day-to-day domestic banking. Most EU countries welcome British expats as bank customers — particularly those with proof of residence and a history of stable financial conduct.

Recommended banking structure for British expats in Europe in 2026

1. Offshore account (Isle of Man or Channel Islands) — for savings, international transfers, and the financial anchor of your arrangement. HSBC Expat or Barclays International are the most widely used.

2. Local bank account in your EU country of residence — for local bills, direct debits, local income (if applicable), and cash withdrawals. Open with a mainstream local bank or a well-established international bank with a presence in your country.

3. Multi-currency app (Wise or Revolut) — for day-to-day multi-currency spending, UK-to-EU transfers at competitive rates, and additional currency functionality.

4. UK account if genuinely needed — if you retain genuine UK financial ties (UK property, UK income, UK pension contributions), maintaining a UK bank account makes sense. Many British expats in Europe retain a UK account with one of the banks that has continued to serve EU-resident customers without restriction — but this should be verified with the specific institution.

Ongoing monitoring

Rules in this area continue to evolve. Bank-specific policies, individual EU country regulations, and the ongoing development of equivalence decisions between the UK and EU will continue to affect the landscape. Anyone who has not reviewed their banking arrangements since Brexit should do so.

Key questions to ask:

• Has my UK bank confirmed that it is still able to serve me as an EU resident?
• Am I relying on a single UK account that could be restricted without notice?
• Do I have an offshore account that provides a stable alternative?
• Are my CRS reporting obligations correctly managed — i.e., does each bank know my country of tax residence and is it reporting to the right authority?

How Global Investments can help

Global Investments has supported British expats in Europe through the practical consequences of Brexit, including restructuring banking arrangements to ensure continuity and compliance. Our advisers understand the offshore banking market thoroughly and can help you establish an appropriate arrangement that is robust to future regulatory changes.

We work alongside qualified tax advisers to ensure that your banking structure is correctly aligned with your tax residency position, and we can introduce you to offshore banking providers appropriate to your circumstances. Contact us to review your European banking arrangements.