Brexit: The industry perspective – FinanceFeeds investigates how London’s FX giants view their future

A giant European shadow casts itself over the shoulders of British prime minister David Cameron as he heads further into the discussions with the powers that be in Brussels, and across member states of the European Union.

Mr. Cameron has, whether through his own direction or as a result of pressure from within Europe, recommended that Britain remains a member state of the European Union, however business leaders across Britain, as well as a large proportion of the population, would be very keen to regain the sovereign independence of the country, and let it thrive once again as a self-supporting nation which is master of its own commercial, financial, social and political destiny.

Some analysts consider that a saving of £55 million per day would be made by not being a member of the European Union, and British firms would be able to be free from European directives on how to operate their businesses, returning power to those within Britain, and preserving the business-orientated nature of London’s commercial economy, free from low-tech, socialist Europe and with the ability to form trade relationships with every independent nation on earth, including the very important regions in the Far East, such as Hong Kong, home to many British electronic trading entities, Singapore, Asia’s largest interbank FX center, and mainland China, a nation willing to do business with Britain to the point that President Xi Jinping visited the UK to pledge £40 billion of investment to drive Anglo-Chinese business relationships forward.

The perspective from within the FX industry is indeed of interest, and FinanceFeeds today spoke to executives who have a keen interest in this subject.

Jean-Raphael Nahas, Head of Sales at Blackwell Global explained to FinanceFeeds “Possibly the highest uncertainty for the UK leaving the EU is the fact it has never been done before, no country has made an exit and therefore any prediction will be very difficult. If the Brexit happens the risk is that other European countries suffering debt could follow, which could lead to the European Zone to collapse.”

“There will definitely be an impact on the FX business in London as it has a name for being the key player in the Forex market and we could witness a large volume of business to be shifted to Asia as Fx firms in Britain would be free of European financial policies, and could then independently work with Asian firms” concluded Mr. Nahas.

In London, Peter Cruddas, CEO of British spreadbetting and CFD company CMC Markets, recently donated to the campaign for exiting the EU, declaring his perspective that his preference would be an independent Britain. Former Conservative party treasurer Mr. Cruddas has donated £1 million to the Vote Leave campaign which supports Britain’s exit from the EU, and has predicted that other senior executives within Britain’s large corporations would also support severing links with Brussels.

Mr. Cruddas took the role of CMC chairman as he spent more time in politics, but he returned as chief executive in 2013 after resigning from the Conservative party.

Whilst making it clear that he supports Britain’s potential exit from the EU, Mr. Cruddas has publicly stated that he was unlikely to put more money into the Brexit campaign. “It’s pretty well-funded now. It’s well run and is chugging away” he said.

Speaking to FinanceFeeds today, David Mercer, CEO of LMAX, the world’s only multi-lateral trading facility for FX, which is based in London, had this to say: “For my part I don’t believe an exit would have much effect on London’s position as the world’s leading FX hub. London is home to all the leading FX participants and venues and that will be the case for decades to come due to timezone, technology proficiency and capital markets expertise.”

Mr. Mercer further explained to FinanceFeeds “Regulation is slowly becoming standardised across the globe and the room for regulatory arbitrage will diminish in the coming years. In or out London will retain its number 1 status with perhaps enhanced volumes as we approach the referendum date!”