Brexit: City of London must compete with New York and Singapore, rather than Paris, for Barclays

Brexit presents both a challenge and an opportunity for the UK finance industry. The exit from the EU should be an opportunity for the City of London – which should emerge strengthened – to compete with New York and Singapore, rather than Frankfurt or Paris, according to the boss of the British bank Barclays. The exit from the EU, which took effect on January 1, “gives the UK the opportunity to define its own agenda in financial services and by doing so to remain competitive outside Europe”, explains Jes Staley, in an interview with the BBC. “This is really what the government should be focusing on and I think they are doing it,” he added.

The financial sector was largely absent from the Christmas Eve trade deal between the EU and the UK, which focused on the exchange of goods. However, finance represents 7% of the British economy and contributes to the international influence of its capital and its famous City, which must emerge strengthened from Brexit according to Mr. Staley, himself an American. “London doesn’t need to focus on Frankfurt or Paris. It needs to focus on New York and Singapore,” he says. He even goes so far as to estimate that “Brexit is probably more something positive than negative” for his sector.

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The boss of Barclays, one of the largest British banks, however, believes that the United Kingdom should avoid deregulating finance to remain attractive. “I wouldn’t burn a piece of regulation,” he said, instead believing that high standards are a strength. However, he acknowledges that Brexit, which deprived banks of their European passport allowing them to operate on the continent from the United Kingdom, has resulted in displacements of jobs and activity.

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“Yes jobs are going to Europe, whereas they could have been in the United Kingdom, but it’s a few hundred (…) Capital has moved but London obviously remains the main center for Barclays,” he said. The Governor of the Bank of England recently estimated that 7,000 jobs “at most” had left London as a result of Brexit. This is far less than the tens of thousands of job losses feared at the time of the vote to leave the EU in 2016.

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Jes Staley’s speech echoes that of Catherine McGuinness, political leader of the City of London Corporation. She explained in an interview with AFP in January that the sector had its eyes turned towards its development outside the EU and specified that the City did not want “a high stake of regulations”. The United Kingdom and the EU, for their part, want to reach a framework agreement on cooperation in the regulation of financial services by the end of March.

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