EU poised to cave on City of London demand in Brexit victory for Boris Johnson – Daily Express

The Prime Minister also said job losses and disruption to capital flows in the City were lower than feared after Brexit.Mr Johnson made clear far fewer bankers had moved to rival European cities such as Amsterdam and Frankfurt than City giants had originally threatened in 2020.

He added: The City of London is crucial not just for our country but for the whole of Europe and for this hemisphere.

If you want to raise money around Europe, if you want to finance your merger or whatever it is, London is still the place to come and always, always will be.

Mr Johnson also branded industry claims that the UK Government was focusing a bigger amount of energy on fishing which generatesless for the British economythan finance after Brexit as nonsense.

The Prime Ministers intervention comes as the EUs head of financial services hinted at a possible extension to Euro clearing permissions.

Temporary permission for London clearers to serve EU customers ends in June 2022.

However, Mairead McGuinness said the European Union was minded to avoid a cliff-edge situation and avoid market instability.

She added: We have to make sure that there is no instability in the short-term, but we also have to look at our long-term interests.

A Brussels source said the bloc was due to grant Britain a temporary extension but indicated clearing may have to move to the continent over a "transition" period.

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They made clear that doing nothing in the face of the limited shift in clearing to date would damage "EU credibility."

The Bank of England and Treasury have recently put increasing pressure on the bloc to grant an extension with senior officials warning the EU risks damaging the UKs financial system" if they prize part of the 80trillion clearing market away from the British capital.

Treasury chiefs also expect the EU to cave due to banking industry pressure after NatWest bank chairman Howard Davies said some banks could move their clearing operations to New York if no extension was granted.

It comes after London Metal Exchange (LME) told customers in Europe to draw up contingency plans in case the European Union does not grant an extension on clearing.

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The LME, which trades and clears metals contracts, said it would work closely with members to ensure an efficient transfer of clearing or closing out of existing positions to minimise potential disruption.

In a memo posted on their website, they added: Given that we have been forewarned of the position, it is important that we take swift steps to mitigate the potential implications of this and ensure that alternative arrangements can be put in place in good time.

A European Commission spokesperson said the focus is on reducing "excessive reliance" on market infrastructure outside the bloc to create an open, strong and resilient EU financial system.

They added: "In particular, the goal is not to move or take business away from London but rather to build our own infrastructures.

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EU poised to cave on City of London demand in Brexit victory for Boris Johnson - Daily Express