LONDON (Reuters) - Switzerland’s stock exchange is in talks with financial regulators in a number of European countries about opening a new gateway to the EU’s single market once Britain leaves the bloc, it said on Monday.
The talks highlight how the City of London’s role as the region’s leading financial hub is likely to be eroded to some extent as companies seek alternative centers to guarantee access to the European Union come what may.
Like many foreign financial firms in London, the SIX Swiss Exchange uses the British capital as a base for business across the European Union, given that Switzerland is not a member of the 28-nation bloc.
“We are in discussions with a number of regulators in order to help us to continue to access markets in Europe and the UK,” a spokesman for the Zurich-based bourse said on Monday.
“Both markets are key for SIX in both the trading and the clearing business. Over half of our members come from outside of Switzerland,” he said.
The Financial Times reported earlier on Monday that the Swiss exchange was in talks with Germany’s BaFin markets watchdog about access to the EU market.
Britain’s exit from the EU, known as Brexit, is forcing many financial companies that use London as a springboard to the EU market to rethink their business models.
London-based Bats Europe, the biggest stock exchange in Europe, has said it may open a base in Dublin to have guaranteed access to the bloc’s single market.
To get access to another EU country, the Swiss exchange will have to show a regulator within the bloc that Zurich’s share trading regulations are similar, or “equivalent” to EU rules.
The equivalency regime is an open-ended process financial firms in Britain can also try to exploit if country’s membership of the single market ends following Brexit.
Reporting by Huw Jones; editing by David Clarke