Amsterdam overtook London as Europe’s biggest share trading venue in January — as Brexit saw about 50% of London’s trading volumes move to the continent — according to data from CBOE Europe.
The data shows an average €9.2 billion of shares a day were traded on Euronext Amsterdam and the Dutch arms of CBOE Europe and Turquoise in January, a more than fourfold increase from December.
Trading volumes in London fell sharply to €8.6 billion in January.
The big shift reflects the failure of the UK to secure “equivalence” rulings from the EU.
EU officials have said they are not in a hurry to make these decisions.
Bloomberg reported that the latest data doesn’t account for the return of Swiss share trading to London, which resumed last week.
The Swiss shares may see the UK edge back ahead of the Netherlands in February, although the UK’s average daily volumes will still be well below their normal levels.
“Brexit is a body blow to the London financial center,” Xavier Rolet, former head of London Stock Exchange Group, told Bloomberg in an interview.
“I’m very deeply worried that Brexit is going to kill the golden goose and we are already seeing the first signs that this has started to happen.”
Bloomberg reported that London’s traditional dominance of global interest-rate swap trading has also slipped, with UK trading venues’ share of the euro interest rate swap market plunging to 10% last month from nearly 40% in July, citing IHS Markit.
In the same period, EU platforms’ market share increased to around 25% from less than 10% and New York venues’ share doubled to 20%.
Meanwhile, UK central bank governor Andrew Bailey has warned that the UK would not be forced to follow EU rules to the letter and that sensible agreements over what constitutes “equivalence” are required.
Giving the governor’s annual Mansion House speech, he said: “The EU has argued it must better understand how the UK intends to amend or alter the rules going forwards.
“This is a standard that the EU holds no other country to and would, I suspect, not agree to be held to itself.
“It is hard to see beyond one of two ways of interpreting this statement, neither of which stands up to much scrutiny.”
He added: “I’m afraid a world in which the EU dictates and determines which rules and standards we have in the UK isn’t going to work.”
Bailey also warned it would be a mistake for the EU would cut off London from its financial systems.
The Bank of England governor said: “I can’t predict what will actually happen exactly because it’s not within our control, but I think we have to state the argument for why it’s important to have global standards, global markets and safe openness.
“And if we all sign up to that, there isn’t a need to go in that direction.”