EU to finalise Brexit trade deal as Amsterdam emerges as top stock market

British Prime Minister Boris Johnson decided he wanted "a run-of-the-mill free trade agreement", explains John Springford, deputy director of the Centre for European Reform in London. "Banks can blow up, so close trade relationships in financial services require common regulations, which Johnson didn't want," he said.

In March, the EU and the UK agreed to create "the framework for voluntary regulatory cooperation in financial services", which means each side will work on limiting regulatory barriers to financial trading, but each can make decisions unilaterally.

"The UK might voluntarily say that, for example, EU-based investment banks can sell to UK clients. But they also might not," says Springford.

"All the signs are that the EU is not going to let the City of London continue to provide many services over the border by granting such equivalence, so banks, funds and other City-based firms have shifted a fair amount of activity into the EU."

..."Two big stock exchanges, the London Stock Exchange Group and Cboe Global Markets picked Amsterdam as their home after Brexit," says Springford.

..."The City has some global specialisms, like foreign exchange trading, fintech and derivatives, that are relatively unaffected by Brexit," says Springford.

"Over time, it's likely that the EU will seek to tighten the screws further, bringing more City-based activity into the bloc. This is likely to be a continuing source of tension between the UK and the EU over the next decade."