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New York remains the world’s top financial center, pushing London further into second place as Brexit uncertainty undermines the UK capital and Asian centers catch up, a survey from consultants Duff & Phelps said on Monday.
Britain will leave the European Union on Friday with future access to its biggest financial services customer uncertain after a business-as-usual transition period ends in December.
The Global Regulatory Outlook survey of 245 senior officials from asset management, banking and other financial firms from across the world found that New York has extended its lead over London.
It said 56 per cent of respondents regard the U.S. financial capital as the world’s most important money hub, up 33 percentage points over the past two years. Only 33 per cent currently see London as the foremost global financial hub, down more than 20 percentage points over the last two years. “It is difficult to avoid the suspicion that three years of uncertainty since the Brexit vote has contributed to London’s fall,” said Monique Melis, managing director at Duff & Phelps.
Both New York and London are set to lose ground over the next five years, with emerging centers in Hong Kong, Singapore and Shanghai expected to see the biggest growth, the survey showed.
Just 22 per cent predict London would still be the major financial center in five years’ time, the survey showed. Few respondents see Paris, Frankfurt or any other European city coming close to replacing New York or London. Respondents favored London over New York in terms of the most favorable regulatory regime for financial services in the world.
“If the Government can position the UK as having a more favorable regulatory environment and separate it from the red tape of European regulation, then we may see the UK win back its crown and attract new talent to the sector,” Melis said.
London has shown resilience since Britain voted in 2016 to leave the EU by leapfrogging New York to become the top center for trading interest rate swaps and remaining leader in currency trading.
(TDS)
