Red alert on Brexit risks to financial services given by City of London Corporation

Jasper Jolly
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The Square Mile - London's Financial District
The City of London Corporation lobbies on behalf of the capital's financial services, among other duties (Source: Getty)

Top lobbyists at the City of London Corporation have upped their rating of the risks posed by Brexit, according to their latest audit of the risks facing the Square Mile.

The Corporation’s report for a meeting this week of the risk and audit committee shows an updated “red” rating in its corporate risk register, an increase from the “amber” rating given in October last year.

The report says that the move “recognises the probability that a post-Brexit trade deal between the UK and EU 27 is unlikely to replicate the level of access firms have within the Single Market.”

Read more: PM rules out payment for City's single market access after Brexit

The Corporation has been a vocal proponent of a Brexit deal which continues the current easy access for financial services firms in the UK and the EU after March 2019. They have repeatedly called for a transitional deal which will secure trade access until a long-term free-trade agreement is reached.

The update to the risk register comes with the government yet to agree a transitional deal or publish a paper outlining their position on the future of the City after Brexit. The Bank of England had previously warned that failing to reach a deal by Christmas 2017, or the end of the first quarter of this year at the latest, would force firms to start implementing contingency plans and moving more jobs out of London.

In its assessment of the risks to the City Brexit could cause, the Corporation notes it could lose “its ability to attract and retain high value global business activity, both as a physical location and in mediating financial and trade flows”.

Read more: Brexit job losses may be lower than first feared says City of London boss

The Corporation has already adjusted its operations in anticipation of Brexit, with extra muscle added to its Brussels and Asia offices.

However, last week the Corporation’s EU envoy, former Liberal Democrat government minister Jeremy Browne, said job losses in the capital may be lower than initially feared.

A spokesperson for the Corporation said: “Brexit clearly represents a challenge for the financial and professional services sector and to the City of London as a leading financial district.

“Given there remains uncertainty over what sort of post-Brexit trade deal might be agreed between the UK and EU27, and because firms are implementing their contingency plans, it is sensible for us to outline the activity that the Corporation has undertaken to mitigate this risk.”

Read more: Sadiq Khan: London will lose 87,000 jobs under "no-deal" Brexit

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