The chief executive of Euronext says euro clearing will almost definitely leave London

Emma Haslett
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Last week the City of London warned moving clearing away from the capital could be "vastly damaging" (Source: Getty)

Days after a dire warning over euro clearing from the City of London Corporation, The boss of Euronext, the owner of four of London's largest stock exchanges, has said it will almost definitely move out of London after Brexit.

Stéphane Boujnah, chief executive of Euronext, which owns France's Cac 40 index, said it is "likely" Brussels will move euro derivatives clearing activity out of London, the Financial Times reported.

If the decision is taken to relocate, we will make sure this has the best impact on Euronext markets. This option is likely to prevail. The euro is their currency and 40-70 per cent is done in London.

He added clearing outside the EU will become an "anomaly".

Boujnah's comments came as Euronext reported revenues of €126.6m (£108.6m) in the first quarter of this year, flat on last year's €126.5m, despite a 15.9 per cent drop on trading volumes for cash products and an eight per cent fall for derivatives.

Earnings before interest, taxation, depreciation and amortisation also dipped to €70.5m, from €71.8m the year before, pushing its margin down to 55.7 per cent, from 56.8 per cent last year.

"Once again, Euronext proved the resilience of its business model with stable revenue and a strong EBITDA in the first quarter of 2017," said Bouhnah.

"Vastly damaging"

Earlier this week the City of London Corporation warned moving London's euro clearing market could be "vastly damaging and potentially destabilising".

At a conference for the futures industry, the corporation's policy chairman, Catherine McGuinness, said:

All the evidence points one way: that the mass uprooting and offshoring of part of the industry – of clearing of transactions in one currency – would not only be vastly complicated, but also vastly damaging and potentially destabilising.

She added that London has built up the "infrastructure and the people", as well as the ancillary professionals, including lawyers, consultants and accountants, who are experts in their field.

"Clearing is here for these reasons," she said.

Read more: City grandee in tirade against EU move to grab London's euro clearing crown

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