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Brexit : London ready to take measures to reduce impact

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Updated: 00:00 GMT, Jan 1, 1970 | Published: 10:49 GMT, Jun 28, 2016 |
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City of London policy chairman Mark Boleat said Monday that although the City is disappointed with outcome of the Brexit referendum, it is ready to implement the decision and take measures to stabilize the situation.

Boleat made the remarks after the UK’s banking center held a press conference on Monday morning to respond to the impact on the British financial market brought by the Brexit.

“Well the immediate response was disappointment. It wasn’t the result the city wanted. You’ve seen a lot of volatility in financial markets. That’s not unexpected, that will always happen when you get a big event like this. Now it’s a question of, well that’s the decision, let’s get on with implementing it, assess carefully what it means for individual institutions and markets, take whatever steps we can to stabilize the position, and to look forward to what other business can we build, what business can we keep, what do we need to say to the government,” said Boleat.

Global financial markets have been in disorder since Britons voted to leave the European Union on Thursday, with the pound and several major stock indexes posting their biggest losses in years.

When markets opened on Monday, the pound plunged to a 31-year low of 1.31 U.S. dollars and some share trading was temporarily halted. Yields on 10-year UK government bonds declined below 1 percent for the first time.

The UK’s FTSE 100 stock index closed down 2.6 percent in London on Monday, while the FTSE 250, focused on the domestic economy, was down 6.97 percent after falling 7 percent on Friday, the biggest day-to-day fall since the 1987 recession.

As the Brexit means British companies may not have the same access to continental Europe as in the past, some financial institutions, including HSBC and Morgan Stanley, are considering moving parts of their euro businesses back to other European countries.

Boleat said the City of London will try to join the UK government’s negotiations with the EU in an effort to earn more beneficial clauses for the City and, therefore, maintain its position as the world’s biggest financial center.