According to a new report by the International Financial Services London, a UK-based research group, international business in the UK financial sector has mostly continued its recovery from the past two years into 2005.
The findings of the report are as follows:
The annual report found that indicators of financial services activity in the UK show that city-type employment totalled 316,000 at the end of 2004, up 8,000 from the previous year with a further rise to 326,000 predicted for 2005.
Net exports of UK financial services totalled a record £19 billion in 2004, up 9% from the previous year, although the economic effects on the US of hurricane Katrina have lead to mass insurance claims that are likely to depress net exports in 2005.
In July 2005, over three-quarters of European-based hedge funds assets — $213 billion out of $280 billion — were managed in London.
Trading in UK-listed companies on the London Stock Exchange totalled £2,316 billion in the first nine months of 2005, up 5% from the same period in 2004.
The IFSL report noted indicators of the UK’s position as an international financial power. One of the indicators is that the UK holds the leading share, 17%, of net issues in the international bond market in the first half of 2005.
The share of global foreign equity trades booked at the London Stock Exchange totaled 44% in the first nine months of 2005, down 1% from 2004. The UK handles the leading share of international bank lending, at 20%, and international bank borrowing, at 23%, in March 2005.
UK participants in the Eurex exchange accounting for 47% of contracts in the first three quarters of 2005, up from 30% in 2000.
The UK accounting for 31% of global foreign exchange trading in April 2004 or $753 billion. Trading in the UK fell 11% to $679 billion in April 2005 mirroring a global trend. The UK accounting for 43% of over-the-counter derivatives turnover in April 2004.