UK Financial Services’ International Position Strong Despite Slowdown In Some Sectors

The international position of UK financial services remains strong despite a recent slowdown in some sectors according to a new edition of IFSL’s International Financial Markets in the UK report. Latest indicators show that:

• Economic trends indicators show that ‘City-type’ employment totalled 353,000 at the end of 2007, up 11,000 from 2006. IFSL estimates that there may be a loss of 10,000 ‘City-type’ jobs in 2008. The UK financial services trade surplus increased 29% in 2007 to a record £33.2bn. Financial services increased their share of UK GDP to 10.1% in 2007 from 9.4% in the previous year.
• London was the leading location for number of IPOs in 2007 with a 18% global share. Trading in UK and foreign listed companies on the LSE increased 13% in 2007 to £7,704bn. The London Stock Exchange had a leading 46% share of foreign equity trading in 2007.
• The UK’s one-quarter share of net issues in the international bond market in 2007 was up from 15% in 2006.
• Trading on Liffe totalled 949 million contracts in 2007, up 30% on 2006. The volume of trading at LME, EDX and ICE Futures Europe was also up. UK participants in the Eurex exchange accounted for 46% of contracts in 2007. London accounted for 43% of global OTC derivatives trading in April 2007.
• Daily foreign exchange trading in London increased from $753bn in April 2004 to $1,472bn in October 2007. London accounted for 34% of global foreign exchange trading in April 2007.
• The UK accounted for 35% of European securitisation issues. Strong issuance in the first half meant that global isusance in 2007 was down only 8% to $3.8 trillion, but is expected to fall by a quarter in 2008.
• The UK was the source of a quarter of European investment banking revenue in 2007. It had the leading share of international bank lending (21%) and international bank borrowing (23%) in September 2007. UK banking sector assets increased 11% in 2007 to £6,964bn.