Brexit Banking Boost: UK financial sector to DOUBLE in size after EU exit, Carney claims | City & Business | Finance

Mr Carney said the City of London and all of its assets are together already worth 10 times more than the annual output of the rest of the UK – and is set to flourish once Britain leaves the European Union.

Fears have emerged that European cities including Frankfurt and Paris are trying to poach business from London amid Brexit uncertainty, but Mr Carney said the UK will continue to thrive.

He said: “If the UK financial system thrives in a post-Brexit world, which is the plan, it will not be ten times GDP, it will be 15 to 20 times GDP in another quarter of century because we will keep our market share of cross-border capital flows.

“Well then you really have to hold your nerve and keep the focus.”

Mr Carney was speaking to the Guardian to mark the 10th anniversary of the start of the global financial crisis in August 2007.

He said: “We have a financial system that is [now] 10 times the size of this economy… It brings many strengths, it brings a million jobs, it pays 11 per cent of tax revenue, it is the biggest export industry by some token… all good things.

“But it’s risky.

“We have a view… that post-Brexit the level of regulation will be at least as high as it currently is and that’s a level that in many cases substantially exceeds international norms.

“The problem you have is that the same issues re-emerge under different labels… and the progress that’s been made… is gradually chipped away.”

Yesterday the Bank voted to keep interest rates at 0.25 per cent in a blow to UK savers.

Andy Haldane, the Bank’s chief economist, decided to vote for “no change” after lacklustre economic growth and easing inflation has dampened speculation over a hike.

The decision comes a year after the Bank slashed rates to the new all-time low in the aftermath of the Brexit vote.

There has not been a rise since August 2007. 

Prior to June’s inflation reading of 2.6 per cent, there had been growing clamour for a rate rise as a Brexit-fuelled increase in the cost of living ramps up pressure on hard-pressed households.

Ross Andrews, director of fixed rate bond provider, Minerva Lending, hit out against Bank of England’s Mark Carney. 

He said: “This has delivered yet another body blow to the nation’s savers.

“With UK growth forecasts downgraded by the Bank of England, the odds of an interest rate rise this year have now lengthened considerably.

“With the UK on slightly uncertain ground, politically and economically, a rate rise any time soon remains highly unlikely.

“Even when…

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