Nerves in the City before the possibility that there is no agreement on Brexit

Operators and customers have many doubts about the operation once the UK divorces the EU

Nerves in the City before the possibility that there is no agreement on Brexit

The European Union negotiator with the United Kingdom, Michel Barnier, threw a jug of cold water on the UK financial sector after communicating to the EU ambassadors that there may not be a Brexit deal after all.

This caused the nerves of the City of London financial industry, already on the surface, to grow.

Nobody you really know if there will be any form of equivalence between the City of London and the European Union on securities trading, even if the common rules on derivatives extends until mid-2022.


Many bankers who asked themselves “can I trade?” they were calm at first after assuring from Wall Street that there were no interruptions, for example with the recent announcements of Goldman Sachs.

However, these measures cannot be sufficient to prevent a migration of London trading volumes.

More unresolved doubts

The most important question in the medium term for managers and their clients, when they think about running their business, will be “how much more will this cost me?” and why should it change? ”

Until it is established the post-Brexit regulatory regime liquidity will determine the answer.

Until a critical mass has built up in European markets, it may not be feasible, or profitable, to shift the London business beyond what needs to be negotiated within the EU, and even Brussels may resist forcing funding for the industry with sudden full regulatory scrutiny.

Long-term business costs will increase if people are forced to trade within the EU, but you cannot optimize your use of capital across different national locations.

London, financial center

London became the dominant financial center due to lower costs, ample liquidity and a relatively proactive attitude.

Unless European markets can compete, volumes will largely stay where they are.

Now Europe has the opportunity to build a market to occupy its space. This is not a new challenge, as it was achieved by setting the German Bund as a benchmark.

Operators and customers have many doubts about the operation once the UK divorces the EU


Nerves in the City before the possibility that there is no agreement on Brexit

The European Union negotiator with the United Kingdom, Michel Barnier, threw a jug of cold water on the UK financial sector after communicating to the EU ambassadors that there may not be a Brexit deal after all.

This caused the nerves of the City of London financial industry, already on the surface, to grow.

Nobody you really know if there will be any form of equivalence between the City of London and the European Union on securities trading, even if the common rules on derivatives extends until mid-2022.


Many bankers who asked themselves “can I trade?” they were calm at first after assuring from Wall Street that there were no interruptions, for example with the recent announcements of Goldman Sachs.

However, these measures cannot be sufficient to prevent a migration of London trading volumes.

More unresolved doubts

The most important question in the medium term for managers and their clients, when they think about running their business, will be “how much more will this cost me?” and why should it change? ”

Until it is established the post-Brexit regulatory regime liquidity will determine the answer.

Until a critical mass has built up in European markets, it may not be feasible, or profitable, to shift the London business beyond what needs to be negotiated within the EU, and even Brussels may resist forcing funding for the industry with sudden full regulatory scrutiny.

Long-term business costs will increase if people are forced to trade within the EU, but you cannot optimize your use of capital across different national locations.

London, financial center

London became the dominant financial center due to lower costs, ample liquidity and a relatively proactive attitude.

Unless European markets can compete, volumes will largely stay where they are.

Now Europe has the opportunity to build a market to occupy its space. This is not a new challenge, as it was achieved by setting the German Bund as a benchmark.