ALEX BRUMMER: Upgrade for London’s Trade as EU Sway through LSE’s £ 22 Billion Merger with Former Reuters Platform Refinitiv
Those who question the resilience of the city outside the EU have received a keen reminder that there is still life in the old dog.
The EU has enacted the £ 22 billion merger of the London Stock Exchange (LSE) with information and trading group Refinitiv – the former Reuters platform – which presents a huge opportunity after Brexit.
It establishes the LSE as a global information and analytic powerhouse, but also offers trading opportunities in forex and bonds. The deal involves the LSE exchanging a European bond market at Borsa Italiana for a global market controlled by Refinitiv. This, at a time when doomsday thinkers are mocking the prospects for UK financial services outside the EU.
Those who question the resilience of the city outside the EU have had a keen reminder that there is still life in the old dog, says Alex Brummer.
Former municipal minister, Lord Myners, took to the airwaves to suggest that the migration of euro-denominated stock transactions from London to the mainland was the thin end of the wedge and that terrible things would happen, such as a shift in wealth management .
Square Mile panjandrum Mark Boleat writes to the Financial Times that only 10,000 jobs have shifted from London to competing European centers in the past four years, but 75,000 will go in the longer term.
It seems inexplicable that Boleat, the ‘political leader’ of the City of London Corporation, should be doing Brussels’ work rather than embracing Chancellor Rishi Sunak’s Big Bang 2.0 plans.
A chairman of one of the larger London banks told me this week that the alleged loss of about £ 5 billion in Euro shares trading to Europe is a ‘red herring’. Private investors buying or selling Santander stock, for example, through a broker like Hargreaves Lansdown, wouldn’t notice any difference.
Larger institutional deals are often as if not done through multilateral trading platforms operated by the larger banks or through the LSE’s Turquoise system, which has prepared with a parallel trading facility in Amsterdam.
We saw this week how far the city from the dying is outside Europe. Dr. Martens and Moonpig have announced LSE floats, newly listed tech beauty platform The Hut Group saw its shares soar after an optimistic trading report. Meanwhile, fintech group Checkout raised £ 370 million in additional capital, bringing the company worth £ 11 billion.
Square Mile panjandrum Mark Boleat (pictured) writes to the Financial Times that in the past four years only 10,000 jobs have shifted from London to competing European centers, but 75,000 jobs will go in the longer term.
New data shows that the UK has gained a leadership position in Open Banking, embracing 300 fintechs and the volume of banking transactions executed online rose to more than 5 billion last year. Great Britain and Denmark are the only European countries to rank high in the World Bank’s ranking of easy places to do business.
So what should we expect from Sunak’s plan? Various initiatives are underway. Former EU Commissioner Lord Hill has been charged with shaking up technical listing rules in London so that restrictions on dual share classes can be lifted. The city could become a leader in issuing and trading green bonds (as it was for Eurodollar bonds in a bygone era).
And steps are underway to free Britain from the burdensome regulatory regime for insurers known as Solvency II to free up money for investment. The voices of despair should rethink.
Morrisons was praised this week for being the first major grocery store to enforce the wearing of masks in its stores. Now it is doing something so important for its 96,000 employees, raising the wage level to £ 10 an hour, a 9 percent increase.
That means that since David Potts took over as CEO in 2015, store associates have seen rewards increase by 46 percent. A bit of a contrast to Tesco, which was recently found to have paid nearly 79,000 workers less than the minimum wage for a short period of time due to an ‘administrative’ error. As frontline workers fight to keep us fed and clean, the supermarket staff earn a share of the pandemic profits.
The Financial Conduct Authority has valid concerns about the bitcoin bubble, but that hasn’t stopped financial institutions from finding more and more ways to embrace today’s favorite ‘safe haven’ investment. City traders ICM have unveiled the Btcoil, which allows customers who do not want to trade in the dollar, pound et al. To trade in oil using bitcoin. It is described as a ‘unique and easy way to trade both products at the same time’. Sounds like double danger.