London Still Tops Financial Centers Despite Brexit, Survey Says
(Bloomberg) -- London retained its crown as the world’s top financial center in a ranking that surveys industry professionals, extending its lead over New York and Hong Kong despite ongoing uncertainty about the implications of Brexit.
The U.K. capital fell only two points in the latest Global Financial Centres Index published by Z/Yen and the China Development Institute, the smallest decline among the top 10 centers. New York held on to second place, but fell 24 index points overall, “presumably due to fears over U.S. trade,” the survey said.
Frankfurt, Dublin, Paris and Amsterdam -- all set to gain banking jobs that will likely have to leave London -- all rose. In Asia, Hong Kong leapfrogged Singapore into third place, while other U.S. cities followed New York in losing points.
"Overall assessments for the European centers continued to fluctuate as people speculate about which centers might benefit from London leaving the EU," Mark Yeandle, associate director of London-based think tank Z/Yen and author of the FCI, said in the study, released Monday. “Protectionism and barriers to international trade concern many -- especially in the USA.”
London’s role as the world’s banking hub is under threat if Brexit costs firms based in the city their ability to easily serve clients across the European Union. Most international banks currently sell their goods and services throughout the bloc from bases in London, but those so-called passporting rights are unlikely to be extended after the U.K. quits the EU in 2019.
The index has been released twice yearly since 2007, with the three major Asian centers gradually closing the gap with London and New York over the decade. It ranks 92 cities on a 1,000-point scale, combining data ranging from tax rates to crime from bodies including the World Bank and OECD with survey responses from more than 3,000 people, addressing broad areas including the business environment, infrastructure, human capital and reputation.