UK’s departure from the EU prompts shift in dealing of stocks and derivativesPlease use the sharing tools found via the share button at the top or side of articles. Copying articles to share with others is a breach of FT.com T&Cs and Copyright Policy. Email email@example.com to buy additional rights. Subscribers may share up to 10 or 20 articles per month using the gift article service. More information can be found here.
Amsterdam surpassed London as Europe’s largest share trading centre last month as the Netherlands scooped up business lost by the UK since Brexit. An average €9.2bn shares a day were traded on Euronext Amsterdam and the Dutch arms of CBOE Europe and Turquoise in January, a more than fourfold increase from December. The surge came as volumes in London fell sharply to €8.6bn, dislodging the UK from its historic position as the main hub for the European market, according to data from CBOE Europe. The shift was prompted by a ban on EU-based financial institutions trading in London because Brussels has not recognised UK exchanges and trading venues as having the same supervisory status as its own. Without this so-called equivalence to ease cross-border dealing, there was an immediate shift of €6.5bn of deals to the EU when the Brexit transition period concluded at the end of last year. It was about half of the amount of business that London banks and brokers would normally handle. Analysts and executives say the transfer would not mean thousands of jobs leaving London, while the tax hit would be limited to the effects the move in trading would have on the profits of companies involved, they said. Financial services contributed almost £76bn in tax receipts to the UK Treasury last year.
Still, the large move in share trading to Amsterdam makes the city one of the early winners from Brexit. Since the start of the year, Amsterdam has also picked up activity in swaps and sovereign debt markets that would typically have taken place in London before Brexit. CBOE Europe is setting up a derivatives trading business in the Dutch capital in the first half of the year.
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