UK banks and insurers have shifted more than £1.0 trillion to the European Union in response to Brexit, a study published Friday found.
More than 440 firms operating in the UK banking and finance sector have relocated parts of their business, moved staff or established new EU entities in response to Brexit, according to the study from think-tank New Financial.
The total £1.0 trillion is equivalent to $1.4 trillion or 1.2 trillion euros.
“While this is the most comprehensive analysis yet of the impact of Brexit on the City, we think it is an underestimate: we are only at the end of the beginning of Brexit,” New Financial warned in a report published almost four months after Britain left the EU.
British-based banks have shunted in excess of £900 billion in assets into the bloc, or ten percent of total UK bank assets, according to its analysis.
And insurers have shifted more than £100 billion.
The nation’s departure from the single market ended access to the so-called financial passport, which had allowed UK firms to offer their services across Europe.
London and Brussels signed a memorandum of understanding on financial services last month but have yet to address the topic of equivalence, which allows UK-based firms to operate on the European continent.
Britain finalised its divorce from the European Union on December 31, after clinching a last-gasp trade deal that did not include the powerhouse financial services sector.
“Getting Brexit done is only the end of the beginning of the process: given the limited equivalence arrangements in place, over time we expect there to be a drip-feed of business and activity from the UK to the EU,” the London-based think-tank added on Friday.
“As the EU takes a tougher line on the location of activity and individuals we expect these headline numbers to increase in future.”
Following Brexit, Amsterdam has also overtaken the British capital in European equity trading.