Post Brexit: State of UK financial services then and now

Brexit did not destroy UK financial services, but it did remove a comfort blanket. Before Brexit, there was a sense that London’s position was almost automatic. Now the sector has to work harder, prove its value and compete on expertise, regulation, innovation and global relationships.

Has it changed for the better? In some ways, yes. The industry has become more commercially alert and more aware that reputation cannot be taken for granted. But it has also become more complex. Cross-border work, regulation, recruitment and long-term planning have all become harder for some firms.

The biggest issue is confidence. Financial services thrive when there is political stability, regulatory clarity and ambition. The UK still has world-class talent, advice, fintech, investment and professional services, but we need to stop behaving like history guarantees the future.

Post-Brexit Britain can still lead, but only if it chooses innovation over nostalgia.

Some business, jobs and influence have moved to EU centres, while Britain has too often replaced Brussels bureaucracy with home grown hesitation. The great promise was a more dynamic, competitive financial hub. Instead, advisers and firms still face heavy regulation, rising costs and a political class that talks about growth while making it so much harder to achieve. London remains a global powerhouse, but it is winning despite policy, not because of it. The damage is less a single cliff-edge event and more a slow leak of confidence, money and ambition.

Brexit's impact on financial services, ten years on, has been more nuanced than the headlines suggested. "Project Fear" predictions of the City of London's collapse never materialised. Firms like JP Morgan, which shifted staff to the continent in the early post-Brexit years, have since returned. For purely domestic firms, the environment has genuinely improved. Freed from EU constraints, the UK has dismantled the widely disliked PRIIPs regime and domestic regulation now favours agile, outcomes-based growth. For cross-border and wholesale firms, the picture is harder. The loss of passporting rights created lasting friction, forcing costly European hubs or complex local rule compliance. Operating across two diverging systems, UK outcomes-based law versus rigid EU directives, has inflated compliance budgets and embedded a legacy of fragmentation and dual-regulatory burden.

As someone who was a hard Remainer, it's easy just to look for disadvantages since Brexit, so to provide a more balanced view, I've looked for benefits to the UK since. However, most of the ‘benefits’ are regulatory freedoms the UK now has in theory, and whether they translate into real competitive advantage is still unproven a decade on.
Change was slower than feared, with fewer job losses than the 100,000 predicted pre-Brexit; however, it is more permanent than anticipated, as 40,000 financial services roles have relocated to other EU countries. We are left to ponder which jobs would have been created in the UK but instead went elsewhere.
London lost its spot as Europe’s primary share trading hub, 10% of UK banking sector assets moved to the EU, and our share of the financial services export market declined significantly. The roadmap published this week by UK Finance to rebuild UK-EU financial services collaboration indicates a clear shortfall that should have been addressed sooner.

A decade on from the Brexit vote, the housing market looks busier on paper and quieter in practice.

The average UK home has gone from £214,000 in June 2016 to £268,000 now, up about a quarter (ONS). But fewer people are actually moving: 1.23 million homes changed hands in 2016, against roughly 1.1 million in 2024 (HMRC). Prices up, transactions down.

Meanwhile the cost of moving has climbed. Stamp duty pulled in £13.9 billion in 2024-25, up 20% in a single year (HMRC), as lower thresholds and surcharges push more buyers into higher bands. The take grows even as the number of moves shrinks.

So has it changed? The market is more expensive to buy into, more expensive to transact, and less liquid than in 2016. People are wealthier on paper and more stuck in practice. That, more than anything in the City, is the post-Brexit story most households actually feel.