Stéphane Boujnah told the Financial Times that at present 30-45 per cent of trading in euro-denominated assets is done out of London, which is only acceptable while the UK is part of the EU and the single market.
“The moment London stops being in the single market, this [dominance in euro-denominated trading] becomes an anomaly, and as with any anomaly regulation will appear to limit those businesses,” he said.
The comments tap into a wider fear that the UK’s dominance in financial services will suffer outside the EU, with some banks already warning that they will shift jobs to the continent.
HSBC said earlier this year that it would move about 20 per cent of its London workforce — about 1,000 jobs— to Paris in the event of a vote for Brexit, saying jobs would go from the trading room and investment banking.
Mr Boujnah said that in the event of the UK leaving the EU, there will be “significant consequences” and many banks will end up moving personnel and operations to the eurozone, for example to Paris, Amsterdam or Dublin.
“Some organisations moving screen-facing jobs might find Dublin very attractive, but people who need to be closer to clients or sources of assets will consider Amsterdam and Paris,” he said.
Christian Noyer, the former governor of the French central bank, said in March that European authorities would “no longer tolerate” London remaining the trading centre for the euro if Britain left the EU.
Mr Boujnah said there could be other consequences for the City of London should voters decide to leave the EU, raising questions about the proposed merger between London Stock Exchange Group and Deutsche Börse.
The deal to create a London-based European trading, data, settlement and risk management group already faces significant regulatory hurdles and needs to win shareholder approval from both sides.
The votes are expected to happen after the UK’s EU referendum. A vote to leave could potentially create a fall in the the value of the British pound or a fall in trading volumes at LSE, according to some economists and analysts.
“Some shareholders [of Deutsche Börse] might want to further analyse the impact on LSE should Britain leave the EU . . . Being inside the single market is not the same as being outside the single market,” Mr Boujnah said.
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