The Competitive Position of London as a Global Financial ... - Z/Yen

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Several respondents made the point that London is the ‘English speaking centre’ for nationalities, such as Australians, New Zealanders and South Africans. Many of these people are highly qualified and have worked in banking in their home countries. These people want to visit and work in Europe and see London as their first port of call. One interviewee did express caution about staffing in London - the quality of staff is excellent, but he felt that there is a shortage of skills in derivatives operations. London is seen as having high employment costs although some of the add-ons costs are significantly less than other European centres. One of our interviewees said that he felt the high cost was offset by the quality of staff: It is expensive to employ people in London - we don't mind the cost because we use the quality of our people as a competitive advantage – most of my operations team have degrees and foreign languages. - Operations Director - Global Investment Bank. In the 2003 survey, growing EU labour regulation was seen as a key threat to London’s position. This threat remains with the UK’s adoption of the EU’s Social Chapter and the steady flow of labour market regulation making themselves felt. This is, however, unlikely to drive jobs away from London towards other European centres whilst these centres remain even less attractive. Because the labour regulations are European, there is a threat that financial centres outside Europe could become comparatively more attractive. This might, for example, lead banks from USA to relocate more operations back in the United States. The current feeling in London is that the Government is acting responsibly in the adoption of EU labour legislation and that London’s competitiveness is unlikely to be badly damaged. 20
4.2 Regulatory Environment (2 of 14) The regulatory environment ranked as the second most important factor in the competitiveness of an international financial centre. In the 2003 study, “the importance of a competent regulator” also ranked second. Chart 5 – The Importance of the Regulatory Environment Number of Respondents 160 140 120 100 80 60 40 20 0 Unimportant Of Low Importance Moderately Important 21 Important Very Important International Banking International Other UK Banking UK Other Critically Important Overall, more than 80% of respondents saw the regulatory environment as Very or Critically Important. Respondents from outside the UK placed greater emphasis on the regulatory environment, with 57% considering it Critically Important. This figure compares with 39% in the UK. Just over 60% of international bankers saw the regulatory environment as Critically Important, compared with 35% of UK bankers. The regulatory environment is considered much better in London and New York than it is in Paris and Frankfurt. Over 90% of respondents rate the regulatory environment in London and New York as Good or Excellent. Other research has reported fears about over regulation. One recent study indicates that the banking community in London sees excessive regulation as the most significant risk to financial services at the moment. 19 There is also wider concern about the scale of regulation in all industries. Financial Director Magazine 20 reported two surveys of CEO’s that found that the issue that business leaders are most worried about is over-regulation and the costs of compliance in their industries. The regulatory environment in New York was thought to be slightly poorer than that of London. There are generally two comparisons made about the regulatory environment in London and New York. The first concerns the number of regulatory bodies and the second relates to the philosophy of the regulations themselves. Some people felt that there are too many regulatory bodies in USA and that there is a lack of consistency between them. The trouble with regulation in New York is that it’s not joined up – there are too many people asking you to do too many things and half the time they contradict each other. It would be great to have just one regulator. – Director - Major USA Retail Bank. 19 CSFI, op cit., (Feb. 2005). 20 Financial Director Magazine, March 2005.
Page 1 and 2: The Competitive Position of London
Page 3 and 4: The Competitive Position of London
Page 6 and 7: Foreword Michael Snyder Chairman, P
Page 8 and 9: 1. Executive Summary • This study
Page 10 and 11: • An argument has been made that
Page 12 and 13: 3. What Makes a Financial Centre Th
Page 14 and 15: may not require the involvement of
Page 16 and 17: we examined 14 criteria. Before loo
Page 18 and 19: centers remains crucial for the glo
Page 20 and 21: 4. Results This study considers 14
Page 24 and 25: Generally the Financial Services Au
Page 26 and 27: Access to the markets is obviously
Page 28 and 29: Chart 10 - How the Centres Rank on
Page 30 and 31: Nothing beats face-to-face contact
Page 32 and 33: Excellent whilst the figures for Fr
Page 34 and 35: The 2003 study reported a widesprea
Page 36 and 37: “These days the big banks are all
Page 38 and 39: factors. Indeed if one looks at und
Page 40 and 41: 4.10 Access to Suppliers of Profess
Page 42 and 43: 4.11 Quality of Life Factors (11 of
Page 44 and 45: Chart 28 - The Importance of the Tr
Page 46 and 47: time-zone, as they do in Europe, bu
Page 48 and 49: With the exception of Paris, where
Page 50 and 51: Chart 35 - How the Centres Rank for
Page 52 and 53: Table 5 - The 2005 Competitiveness
Page 54 and 55: 5. Key Trends 5.1 Changes since 200
Page 56 and 57: The 2003 report predicted that “r
Page 58 and 59: There was a mixed feeling towards t
Page 60: Financial centres are where market
Page 63 and 64: In total, 18 countries were represe
Page 65 and 66: • Regulatory Environment • Gove
Page 67 and 68: Appendix C - Interviewees We interv
Page 69 and 70: Marano, Angelo, Beyond the London-F

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