London’s status as global finance center at risk

Top bankers warn of real impact of Brexit

LONDON, April 14, (RTRS): Leading bankers warned on Thursday that Britain is yet to feel the real impact of Brexit which will undermine its status as a global finance centre as companies prepare to shift jobs out of London to preserve access to Europe’s single market.

Goldman Sachs Chief Executive Lloyd Blankfein said that while the US bank will keep its new $1.4 billion new European headquarters in London, it might have chosen another location if it had known Brexit was coming.

“We’re still building it, the cranes are working but we might have made a different decision a few years ago,” Blankfein told Politico in an interview.

The future of London as Europe’s financial centre is one of the biggest issues in Brexit talks because it is Britain’s largest export sector and biggest source of tax. Rival cities within the EU are battling to draw highly-paid banking jobs and the revenues they bring.

As Prime Minister Theresa May plots Britain’s course for Brexit, London’s financial services industry is scrambling to prepare for losing access to the world’s biggest trading bloc, its biggest challenge since the 2007-2009 financial crisis.

The sector accounts for about 12 percent of Britain’s economic output and pays more taxes than any other industry.

Blankfein said companies are taking decisions that may result in less economic activity in Britain although he said that he was surprised at how little effect Brexit has had at this stage. Britain is due to leave the EU next March.

“I am at least wrong in that I would’ve thought there would be a worse outcome by now,” he said.