Central Bank of Ireland backs London’s future as leading financial centre

A new report from The Central Bank of Ireland has concluded that London is likely to remain a leading global financial centre, even in the most adverse Brexit scenarios.

The EU-based Central Bank found that even in the worst Brexit outcomes it modelled, the impact on London’s financial and related professional services industry could be very small due to the ‘premium’ London enjoys [1]. But the UK cannot be complacent. The report warns that a less open and productive UK could still impact London’s status as a global financial centre.

The Central Bank of Ireland also cautions other EU centres, saying that a poor Brexit outcome could negatively impact them, including Dublin, with the visible fragmentation of finance in Europe raising questions about future financial stability risks.

Miles Celic, Chief Executive Officer, TheCityUK, said,

The Central Bank of Ireland’s report provides independent and authoritative support to what we have said for some time. Its concludes that London will remain Europe’s leading financial centre whatever happens with Brexit, but it also warns strongly against complacency in the longer term.

“This industry is a vital engine for the larger vessel of the UK economy. If the UK gets Brexit and the longer-term political and economic direction wrong, the entire economy will be heading into choppy waters.

“This report also reinforces the significant concerns the industry has raised about the financial stability risks of European financial market fragmentation. We urge the UK government, the EU and regulators to work together to find a way to keep markets open and competitive. This is vital for European businesses to continue to access the capital and professional services they need to grow and succeed.”

[1] Central Bank of Ireland, ‘Press release: Financial Stability Note: Central Bank note outlines the landscape for London and other EU financial centres post Brexit,’ 06 August 2019