Clearing house business is one big pie that the financial centers all around the globe would love to steal away from the United Kingdom viz.a.viz London. After the referendum, London’s clearing house business is clearly under threat, especially the Euro clearing part. European Central Bank (ECB) has already attempted pre-referendum to bring back the Euro clearing business inside the Eurozone but the European court ruled in favor of the Bank of England (BoE). But now, if the United Kingdom moves out of the European Union it can expects fresh legal battle over the business. French President Francois Hollande has already called to bring back the Euro denominated clearing to other Euro zone cities outside London.

How big is the pie?

In a word, ‘very’.  Daily average global OTC interest rate derivative market turnover is close to $2.3 trillion and almost 50 percent of that is the euro denominated.

What is UK’s share?

The United Kingdom’s share is interest rate derivative turnover is more than 50 percent and more than 40 percent for FX derivatives. Closest rival is New York, fir which IR derivatives turnover share is 23 percent.

Now with crack in the armor all the financial centers around the world, led by Paris have already started preparations to take a bite out of the pie.