A decade after the referendum, the City of London wants financial services placed closer to the center of Britain’s next negotiation with Brussels.
Nearly ten years after Britain voted to leave the European Union, the country’s financial sector is trying to reclaim a role it largely lost in the original Brexit settlement: a direct voice in shaping the U.K.’s relationship with Brussels.
Britain’s banks, insurers and asset managers are pressing the government to give financial services a seat at the table as London and the EU attempt to reset their post-Brexit relationship. For the City of London, the demand reflects both frustration and strategic urgency. Finance remains one of Britain’s most globally competitive industries, yet it was largely excluded from the trade arrangements that followed Brexit, leaving firms to navigate a patchwork of regulatory barriers, market-access restrictions and political uncertainty.
The push comes as Prime Minister Keir Starmer’s government seeks a warmer relationship with the EU without formally reversing Brexit. Ministers have pursued cooperation on trade, security, energy, youth mobility and regulation, but financial services remain politically sensitive. Any move toward closer financial alignment risks accusations that Britain is quietly re-entering the EU’s regulatory orbit. Any refusal to engage, however, risks leaving one of the country’s most important export sectors outside the room while other industries lobby for easier access to European markets.
For the banks, the argument is straightforward: financial services are too important to be treated as an afterthought. The City contributes heavily to tax revenues, supports hundreds of thousands of jobs and remains Europe’s dominant financial hub despite the relocation of some business to Paris, Frankfurt, Dublin and Amsterdam after Brexit. Industry leaders argue that even modest improvements in regulatory cooperation could reduce friction, improve cross-border business and help both sides manage financial stability risks.
The sector is not necessarily calling for a return to full EU rule-taking. Many City firms remain wary of surrendering the regulatory flexibility Britain gained after leaving the bloc. Instead, they want formal consultation, better channels with negotiators and a more practical approach to areas where U.K. and EU interests overlap: clearing, capital markets, insurance, data, sustainable finance and banking supervision.
That position reflects a delicate balancing act. London wants access and influence, but not automatic alignment. Brussels, for its part, has little appetite for granting Britain the benefits of the single market without the obligations that come with it. The EU has spent years trying to build its own capital markets capacity and reduce dependence on the City, particularly in euro-denominated clearing and wholesale finance.
Yet the geopolitical and economic backdrop has changed. Europe is facing weak growth, higher defense costs, energy pressures and intensifying competition from the United States and Asia. In that environment, some officials and analysts argue that deeper U.K.–EU financial cooperation could serve both sides. London has scale, liquidity and expertise; the EU has a vast market and regulatory weight. A more structured partnership could strengthen Europe’s overall financial resilience without requiring Britain to rejoin the single market.
The politics remain difficult. Brexit was built partly on the promise that Britain would “take back control” of its rules. Financial services, more than almost any other sector, became a test case for whether divergence from Brussels could create a competitive advantage. Any renewed negotiation involving the City will therefore be scrutinized by Brexit supporters, who fear creeping alignment, and by pro-European voices, who argue that Britain’s economic interests require closer integration.
For the financial lobby, the lesson of the past decade is that silence carries costs. During the original Brexit negotiations, the City often struggled to influence outcomes as sovereignty, immigration and goods trade dominated the political debate. Now, as the government considers the next stage of the U.K.–EU relationship, banks want to ensure that the country’s largest services export sector is not once again pushed to the margins.
The demand for a seat at the table is therefore about more than technical regulation. It is a sign that Britain’s post-Brexit settlement remains unfinished. The first phase was about separation. The next is about finding a workable model of coexistence with the EU. For the City, that model cannot be credible unless finance is included.
Whether Brussels is prepared to listen is another question. The EU may welcome dialogue on stability and supervision, but it is unlikely to offer London a privileged arrangement that undermines the integrity of its own market. The result may be a limited, pragmatic reset rather than a grand bargain.
Even so, the banks’ message is clear: after a decade of adapting to Brexit, Britain’s financial sector no longer wants to be a spectator. It wants to help write the next chapter.
