The City is irresistible for scores of firms – and we’ll keep doing business regardless of Brexit
We hear most days how the City will be ruined if Britain votes for Brexit.
It is said that there will be flight of capital to Frankfurt, trade will plummet, and international businesses will lose faith in London’s financial predominance. In the last week, Bank of England governor Mark Carney announced that, in the Bank’s view, a Brexit could lead to recession.
I believe such fears are overdone. At XTB, which was founded in 2004 and now operates in over 12 countries across Europe, we are under no illusions: London is, and will remain, a critically important market for financial services firms to have a significant footprint in.
And it is a market that we, as the fourth largest listed forex and Contracts For Difference trading firm in Europe by market capitalisation, simply cannot afford to ignore.
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London facilitates $2.7 trillion of foreign exchange turnover each day. That’s approximately 41 per cent of forex turnover globally. This is not going to change overnight if the UK leaves the EU. And it is why, despite being fully aware of the risks associated with the EU referendum and Brexit, we remain absolutely committed to expanding our trading and brokerage offering to the UK from our headquarters in Canary Wharf, regardless of the result on 23 June.
We hope this will send a message of confidence to the City at a time when other financial institutions are surprisingly reluctant to commit to the capital post-referendum.
London has one of the most developed financial ecosystems in the world. Playing an active part in its financial hub can make our systems more efficient, our brand more credible, and ultimately provide a springboard for a new wave of scalability for our business.
That makes the case for investing in London extremely attractive. London further benefits from the presence of the Financial Conduct Authority (FCA). Undoubtedly one of the most respected regulators in the world, it has a proven track record of providing consistent and effective regulation.
Operating under the strict oversight of the FCA means our firm has a tactical advantage: it gives our clients confidence that they are trading with a broker which must uphold the highest of regulatory standards.
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Today, this distinction becomes even more important as we see emerging risks from newly-created brokers domiciled in exotic locations. Infiltrating the UK market, they are evading the oversight applied to local FCA-regulated brokers.
There are also now countless Binary Options brokers, who do not currently come under the supervision of the FCA. They market direct to UK consumers and, unfortunately, some of these display a rather dubious duty of care to their customers.
The role of respected regulators such as the FCA is more important today than ever before in maintaining the credibility of the industry and protecting retail traders.
And it is these homegrown advantages which make London irresistible for a European financial services firm like us. This will remain true whatever verdict the British people deliver on 23 June.