The City of London remains the dominant financial center of Europe Business

The City of London retained its crown as Europe’s dominant financial center as fears of a Brexit-induced exodus failed to materialize.

London came second to New York in the latest Global Financial Centers Index, which is published by think tank Z/Yen Group and ranks the world’s 126 major financial centres.

It takes into account areas such as political stability, labor market flexibility, quality of life, infrastructure and innovation.

The City comfortably beat rival European centres, including Paris, Frankfurt and Amsterdam, who finished 11th, 16th and 19th respectively.

It comes despite repeated warnings from business leaders and politicians that Brexit would damage the reputation of the Square Mile.

Despite London’s strong performance, the gap between the UK capital and New York has widened since September, when Z/Yen last released its index.

London’s fintech offering has lagged behind Beijing and San Francisco as Chinese and US hubs have spurred tech development.

He said: “London’s regulatory environment, anti-corruption regime and rule of law are reasonably good. However, the financial services industry and its regulation need to evolve to focus more on the perspectives of individual consumers and beneficial owners of money/assets than service providers.

Still, the report highlights how the Square Mile has weathered the pandemic and Britain’s withdrawal from the EU, compared to other financial centres.

A report by EY earlier this year revealed that a majority of global financial firms plan to establish or expand their operations in the UK this year as investor confidence in the UK financial services sector is at its lowest. highest level.

A massive exodus of finance jobs out of London has failed to materialize after Brexit, despite warnings of hundreds of thousands of jobs migrating to the Continent.

Michael Mainelli, Executive Chairman of Z/Yen, said, “The second half of 2021 saw a level of confidence in the global economy that we have not seen since the start of the Covid-19 pandemic. However, the pandemic remains an unpredictable variable, as does the effect of the Russian Federation’s invasion of Ukraine.

The report will give the Square Mile a boost after it was stripped of passporting rights following the UK’s exit from the EU, which gave businesses full access to European markets.

In recent months, the bloc has taken an increasingly hard line against European institutions that have failed to transfer lucrative clearing businesses from London to the continent.