London is regarded to be the most important financial center in the world, but the outcome of the Brexit vote in late June could pose a risk to the city's status.
According to Bloomberg, if London's financial sector is damaged by Brexit, professionals are more likely to flock across the pond to New York City than across the continent to Frankfurt or Paris. Do you have ideas for articles/interviews you'd like to see more of on Benzinga? Please email feedback@benzinga.com with your best article ideas. One person will be randomly selected to win a $20 Amazon gift card!
Many British banks are losing confidence that a deal will be struck, which would allow businesses in the U.K. to continue selling goods and services freely across the European Union.
Meanwhile, New York City is the only city in the world that rivals London's dominance as a financial hub. Lloyd's of London's chairman John Nelson told Bloomberg in an interview, "There is no way in the EU there is a center with the infrastructure or regulatory infrastructure to take the role London has."
"There is only one city in the world that can, and that is New York," he also said.
Xavier Rolet, the CEO of the London Stock Exchange Group shared a similar sentiment. He made it perfectly clear that if his company can't clear euro derivatives in London the entire business would move to the only other city in the world that can clear all 17 major currencies — New York City.
There could be some hope after all for British banks. Open Europe argued in a report that Europe would be worse off as a whole if highly skilled bankers flee the continent completely.
"This should be in everyone's interest to avoid in the upcoming negotiations," the think tank was quoted by Bloomberg as saying.
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