Brexit and the financial services industry

The City will survive Brexit, but it will not emerge unscathed. In order to remain competitive Britain’s financial services industry will need to adapt, as it has always done. London is the world’s leading international financial centre. While it is important not to overstate the impact of the UK’s membership of the EU, the single market has benefitted the City. As such, it is no surprise the financial sector was broadly in favour of remaining in the EU. The industry has accepted the referendum result and is preparing for Brexit. However, it remains in its interest for the UK and EU to come to an arrangement that maintains mutual, cross-border, market access for UK and EU-based institutions and for continued easy access to EU talent. The industry is also in favour of a long transition period, agreed as quickly as possible. Yet financial institutions have been put in a position whereby they have no choice but to prepare for a worst-case, no-deal scenario. Ensuring a stable transition and a deep and comprehensive future UK-EU partnership is not in any one party’s gift. There is much that could still go wrong, and the industry needs to guard against the potential fallout.

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