Phelps & Duff Survey Reveals New York is Now Top Finance Hub

NEW YORK, N.Y. – A Phelps & Duff survey revealed that New York is now the world’s leading financial center, a post that London has held for a long a time. London’s fall is being attributed to the years that Brexit dominated the country’s economy.

Financial advisors Phelps & Duff recently shared the top takeaways of their surveys on the world’s present regulatory landscape.

According to its Global Regulatory Outlook (GRO) 2020 report, more than half (56%) of the respondents look at New York as the world’s foremost financial hub. Only a third (34%) still chose London for the honor. It was a startling reversal as 2019 saw New York with 42% and London at 52%.

The GRO report acknowledged that it was possible the three years of Brexit wrangling was one of the reasons for London’s “fall from grace.”

Monique Melis, Duff & Phelps’ Managing Director and Global Leader of Compliance and Regulatory Consulting, said that while London was the world’s main financial hub in 2018, the “shockwaves” of the ongoing negotiations with the EU have taken its toll.

But the report also suggested that if Brexit was indeed the reason, then the issue’s resolution could mean the city would soon be back on top.

The UK government is also likely to focus on recovering their standing in the financial world, especially as the financial sector is responsible for 7% of the country’s economic volume. It also brings in around £29 billion in taxes.

Despite not being the premier financial center this year, the UK still holds the distinction of having the best regulatory conditions for finance services. 30% of those surveyed rated the country number one. The US was close on its heels at 26% while Singapore was third with 18%.

The Phelps & Duff survey also touched on the rapid growth of Asia’s financial centers. It noted that Hong Kong, Shanghai, and Singapore as emerging finance hubs expected to showcase major growth.

Survey respondents pinpointed Shanghai as having “the brightest future.” While stakeholders are not considering the city as a major center today, it will be different five years from now. One in ten of the respondents see it leading the way.

The GRO report also claimed that two of the biggest challenges financial companies face were the quest for talent and compliance costs. 33% of the participants said more than 5% of their yearly budgets are spent on compliance.

The Duff & Phelps survey had 240 senior executives as respondents. They work in financial services like asset management, banking, broker dealers, hedge funds, and private equities. They come from all over the world, with seven out of ten respondents representing organizations that operated in numerous countries.