London’s financial position ‘under threat’

Speaking to the Financial Times, Xavier Rolet said key investment decisions affecting the group’s UK businesses may shift abroad, if the merger is successful.

“There’s definitely a medium-to long-term threat which we believe is not completely understood here in the UK,” Mr Rolet told the FT.

He added that the UK was under-represented in Europe, reducing its ability to fight its case amid sweeping reform of the financial sector.

“In terms of the prudential regulations, of credit, insurance, financial stability, there is a European framework where the UK has a voice but not a voice which is in keeping with the size that London and the UK represents.”

He said that while the UK’s Financial Services Authority had a seat on the European Securities Markets Authority, the new pan-European watchdog set up in Paris in January, it had eight per cent of the group’s vote.

He said that although the UK represented two-thirds of financial services activity in Europe, there is a “clear mismatch and a risk.”

Mr Rolet’s comments came as authorities in Brussels are expected this week to decide whether to move their probe into the planned Deutsche Borse-NYSE Euronext combination into a more detailed phase.

The London Stock Exchange is one of the world’s oldest stock exchanges and can trace its history back more than 300 years.

Starting life in the coffee houses of 17th century London, the Exchange grew to become the City’s best known financial institution.

Mr Rolet is the chief executive, and executive director of the London Stock Exchange Group.

He was appointed to the board in March 2009 and became chief executive in May 2009.

From 2000 to 2008 he was a senior executive at Lehman Brothers and, most recently, chief executive of Lehman in France.

Prior to Lehman Brothers, he held senior positions at Dresdner Kleinwort Benson from 1997 to 2000, Credit Suisse First Boston from 1994 to 1996 and Goldman Sachs from 1984 to 1994. He was a Non-Executive Director of LCH.Clearnet until July 2010.