“This columnist has had a few days abroad and offers these quick catch ups for today…
“Firstly, during a brief stop in Switzerland, I noticed an interesting proposal in the news from a Swiss banker about forming an alliance of the Swiss, Singapore, Hong Kong, others and the UK (London) financial centres. Whilst I think highly of the achievements of the non-UK centres and their specialisations, I was taken by how quickly such an association implied London’s future as a regional, off-shore, or specialist centre. Just over two weeks ago London’s only international comparator was New York, and any sentence with the two always finished with ‘London is the international centre’!
“The UK’s Chancellor is out there travelling and trying to inspire confidence in UK finance and Parliament, (the governing party at least), has quickly selected a new Prime Minister, while the Bank of England is saying the right things about liquidity, yet there is the lingering question of what comes next or inevitably what will be the UK’s terms of trade. Thus, for the moment, it appears the ship is no longer listing or without power, but business and banks are asking if those on deck know which way we’re heading. Many surveys indicate weakening consumer and business confidence and a slowdown in UK business activity. The UK ship rapidly needs to identify a clear direction and get full steam ahead before weakening confidence begins to feed upon itself. Banks could do worse than increasing the frequency of speaking with clients and customers to identify increasing and new risks.”
Professor Hahn is a former Senior Corporate Finance Officer at Citigroup and has been a Senior Advisor at The Bank of England. He now holds the Henry Grunfield Chair in Banking at The London Institute of Banking and Finance.