London's investment banks are continuing to take a wait and see approach to the UK’s decision to quit the European Union more than one month after the vote.
Of the 20 biggest investment banks in the UK, 40 per cent have so far expressed a view on the vote. Half of those institutions that have voiced an opinion are neutral, while only 15 per cent said the impact of the vote will be negative, according to a survey by accountancy giant EY.
Both of the countries two largest trading indices, the FTSE 100 and the FTSE 250, have now breached their pre-referendum levels. The FTSE 250 yesterday closed down under the mark however.
Omar Ali, UK financial services leader at EY, said:
While businesses are considering their options for certain elements of their operations, there isn’t one location that is the logical alternative to London or one single location that has capacity to absorb the City.
For now the majority are continuing with a prepare but wait and see approach with a continued focus on serving their clients.
Meanwhile, wealth and asset management firms have been the most vocal firms in the City regarding the impact of Brexit on their businesses, with 60 per cent making public pronouncements since 24 June.
By comparison, 48 per cent and 44 per cent of insurers and investment banks have voiced their thoughts on how the vote to leave will affect them.
Just three per cent of the largest financial services firms that have operations in the UK have made public soundings that they may relocate operations, analysis by EY’s Financial Services practice has found.
By comparison, seven per cent have reaffirmed their commitment to the UK.
As expected, the changes to the economic outlook have prompted asset managers and life insurers into some action, but for the most part businesses are waiting for the negotiations to start in earnest before they make any big decisions.
The lack of public announcements does not, however, mean the sector is not reacting.