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Britain's financial sector reels from Brexit

Friday, June 24, 2016 - 01:58

Britain's 2.2 million financial industry workers face years of uncertainty and the risk of thousands of job cuts after the country voted to quit the European Union. As Sonia Legg reports, it leaves question marks over London's status as Europe's premier financial centre.

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It was a brutal day for banking stocks after Britain's bombshell vote to leave the EU. The top five British lenders saw an average 13 percent fall in the share price, with Barclays suffering their worst ever loss. And there were drops of between 12 - 14 percent at three top wealth managers, including Schroders. And it could have a lasting impact. 2.2 million people work in Britain's financial industry. (SOUNDBITE) (English) CEBR, CHIEF ECONOMIC ADVISOR, VICKY PRYCE, SAYING: "The question is what is going to move out - will things go to Paris, or Frankfurt or will they move to New York which has the ability and the framework around it to deal with the number of things that London does." The mood around the banking hub of Canary Wharf - home to Barclays and HSBC, was sombre. Job security fears rising to levels not seen since the 2008 financial crisis Investment banks had already warned there could move thousands of job losses if Britain opted out And the ECB had signalled it could force euro trading out of London, the world's largest foreign exchange market. (SOUNDBITE)(English) UNIDENTIFIED WORKER SAYING: "Outrageous. I think it's terrible. I think worst day in British history in 50 years. Horrendous, absolutely horrendous." (SOUNDBITE)(English) BANKER PHIL CLOUTING SAYING: "Absolute disaster. I just can't believe it's happened and that people have been so badly misled." But some have sought to play down the fears, saying banks had made contingency plans and were well used to coping with a crisis. (SOUNDBITE) (English) BGC PARTNERS MARKET STRATEGIST, MIKE INGRAM, SAYING: "We are fast moving towards a point where a handful of U.S. banks will have complete hegemony in investment banking so as with other areas I think the Brexit vote may accelerate a number of plans that are already in place but a vote to remain equally would not have turned that situation around." But HSBC's Chairman said the day marked a new era for Britain and British business. Establishing fresh terms of trade with European and global partners would be "complex and time consuming."

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Britain's financial sector reels from Brexit

Friday, June 24, 2016 - 01:58