No-deal Brexit threat sends banking volumes in Britain to 28-year low

[snoop1130]

No-deal Brexit threat sends banking volumes in Britain to 28-year low

By Huw Jones

 

FILE PHOTO: Canary Wharf and the City of London financial district are seen from an aerial view in London, Britain, August 8, 2019. REUTERS/Hannah McKay/File Photo

 

LONDON (Reuters) - The threat of a no-deal Brexit has sent profits and sentiment in Britain’s financial services falling at their fastest pace since the global financial crash a decade ago, a CBI/PwC survey showed on Tuesday.

 

The latest quarterly survey by the CBI, a business trade body and consultants PwC, said that in the three months to Sept. 30, the level of business activity at banks fell at its fastest pace in 28 years.

 

Banking, insurance and investment funds bring in billions of pounds in tax revenues for the British economy, but direct access from London to its most important market, the European Union, could be blocked if there is a no-deal Brexit on October 31.

 

The quarterly survey of 83 firms found that optimism about overall business in financial services fell at the quickest pace since September 2008 when the Lehman Brothers crash deepened the 2007-2009 financial crisis.

 

The level of optimism has now been flat or falling for 15 consecutive quarters.

 

“The sector is the jewel in the crown of the UK’s world-leading services industry,” said CBI Chief Economist, Rain Newton-Smith.

 

“While it’s encouraging that investment plans have improved, the threat of a ‘no deal’ Brexit is hitting confidence.”

 

Britain has yet to secure a divorce settlement with Brussels, with only a month to go before it leaves the EU.

 

Financial firms in Britain have spent millions of pounds opening hubs in the EU to cope with whatever form Brexit takes.

 

Profits fell at their quickest pace since June 2009, but headcount in banking grew at the fastest pace in since December 2006, probably due to increased regulatory requirements, the survey showed.

 

Andrew Kail, PwC’s head of financial services, said there has been a drop-off in plans to launch new products and services as firms batten down the hatches in expectation of a turbulent few months.

 

Looking ahead to the December quarter, business volumes are expected to fall further, the survey showed. For the coming year, new regulation, Brexit, IT spending and customers switching to rivals would hit business most.

 

-- © Copyright Reuters 2019-10-01

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[nobodysfriend]

Financial markets profit ( stock market ) is based on growth . An already profitable company has to grow , ( make more profit ) every year , if not it's value , ( shares ) , drop .

But eternal growth is finally not possible , some markets are saturated , new markets have to be found to keep growing ... there is a fault in that system that will finally lead to it's own collapse . Of course , short term profit is sometimes still possible , but long term investment is risky . very risky . The stock market tries to anticipate future development that is often based on rumors that may well never become reality .

 

13 hours ago, snoop1130 said:

optimism about overall business in financial services fell at the quickest pace since September 2008

13 hours ago, snoop1130 said:

Financial firms in Britain have spent millions of pounds opening hubs in the EU

13 hours ago, snoop1130 said:

Banking, insurance and investment funds bring in billions of pounds in tax revenues for the British economy

 

[johnnybangkok]

Yeah but it's all 'Project Fear' so we really shouldn't worry. 

Jeez.

[bannork]

2 hours ago, johnnybangkok said:

Yeah but it's all 'Project Fear' so we really shouldn't worry. 

Jeez.

There is no limit to the blindness of No Deal Brexiteers.

[evadgib]

12 minutes ago, bannork said:

There is no limit to the blindness of No Deal Brexiteers.

You'd better save all that 'Cock-a-doodle-doo' lark until you have something to crow about.

[bannork]

1 hour ago, evadgib said:

You'd better save all that 'Cock-a-doodle-doo' lark until you have something to crow about.

There already is plenty to crow or should I say warn about, in the opening paragraphs of this topic. 

[sawadee1947]

Don't worry, some with make a lot of profit with it ????