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US world's top financial center; UK leads Europe amid Brexit risks


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US world's top financial center; UK leads Europe amid Brexit risks

The U.S. is the world's top financial center in terms of quantitative value while second-ranked U.K. is the most dominant financial center in Europe, although Britain's impending exit from the European Union poses risks to its international activity, according to think tank New Financial's international financial centers index.

The U.S. topped the index ranking of nearly 50 countries, with an overall score of 79 out of 100, as it led in absolute terms for both domestic and international financial activity. The U.S.'s overall score is almost double that of the U.K. at 40, which was, in turn, nearly double that garnered by Germany or France.

"While the U.K. cannot afford to be complacent given the uncertainty around Brexit, no other European financial center is going to displace London anytime soon," the think thank said.

Germany, Ireland and Luxembourg have emerged as the most popular destinations for financial firms considering where to establish bases elsewhere in the EU in light of Brexit, according to data gathered by S&P Global Market Intelligence in March. Other countries that may attract business from the U.K. include the Netherlands, France and Belgium.

The performance of large European economies in the overall score were mixed, New Financial said, with Germany at seventh, France at eighth and the Netherlands at ninth. Spain and Italy stood at 20th and 22nd, respectively.

China was the world's third-largest financial center in the index, beating Japan and Hong Kong, driven by its big domestic financial sector in spite of a relatively weak performance as an international financial center and low scores in its nonfinancial metrics. Among the top 10 financial centers globally, four were from Asia.

However, the report noted that factoring in nonfinancial sector metrics such as quality of life, infrastructure and human capital, the U.S. and the U.K. both drop in the rankings to 16th and 11th, respectively, while Switzerland, Luxembourg and Ireland rise to top the list.