New York 'gains at London's expense' post-Brexit

New York is gaining at London's expense when it comes to financial services.

A survey of top executives found London's reputation as a global financial hub continues to fall, while New York's star rises.

Of the 250 finance professionals surveyed by consultancy Duff & Phelps, just 31% named London as the world's premier financial hub. 60% plumped for New York. London's mind share was down from 34% in 2019 and has declined by 22% since 2018.

READ MORE: Derivatives trade worth billions flees London for New York post-Brexit

"It's a sign of momentum," Monique Melis, managing director and global head of compliance and regulatory consulting at Duff & Phelps, told Yahoo Finance UK.

"It's a big cake and there's a piece for everybody but one shouldn't loose sight of the momentum, simply because once you lose it you can never get it back.

"When I started in the City in '94, the UK had just got hold of German bund trading. When the German bunds and the eurobonds started trading in London, they never went back."

Data last week showed Amsterdam had overtaken London as the share trading hub of Europe. New York, meanwhile, has won hundreds of billions of euros-worth of derivatives trade from London. Both changes have happened since the turn of the year when Brexit took effect.

READ MORE: Amsterdam overtakes London as Europe's share trading hub

Duff & Phelps pinned the blame on Brexit, which it said had undermined London's reputation as a global hub.

"With the end of the transition period and Brexit formalized, it’s inevitable that London will continue to lose ground in the battle to be the world’s leading financial center," the company wrote in its Global Regulatory Outlook 2021 report.

"More than half (51%) said Brexit would weaken the UK’s position as a financial center, including 55% of respondents from the UK. Only 12% said it would make it stronger. Even among the UK-based respondents, only a third think London will be the preeminent center in five years."

The UK's financial services sector has been dealt a blow after losing access to the EU's single market. The free trade agreement reached between the UK and EU did not cover financial services. It means UK-based firms can no longer serve European clients unless they set up satellite offices in the bloc. Many in the City of London are hoping the EU will grant so-called equivalence rulings, which would ease the burden.

While Brexit is giving New York get a leg up over London, it doesn't seem to be aiding Europe.

READ MORE: Harming City of London will hurt EU, warns policy chief

"Despite Brexit, there’s been no rush to Europe," Duff & Phelps said. "The number of senior decision-makers in financial services citing Paris or Frankfurt as the top financial centre is negligible, and that’s not expected to change in the medium term."

“Europe is a good backbone but they just don’t have all the history and the complexity and the innovation that we have in the UK," Melis said. "They don’t have the skillset across the whole market as we have. They don’t have people who are investors in the same way."

Dublin and Luxembourg would likely gain back office business from London over the longer term post-Brexit, she said, but the UK has a "huge opportunity to take back the lost ground".

READ MORE: Brexit leaves UK finance in limbo as City fights for EU access

"I think it's all about the policymakers," Melis said. "As soon as they get their act together and there's more certainty about what the UK will look like, I think business will flow back here. We trust the system and we trust the regulators. It's not a broken system it's just the uncertainty."

WATCH: NYSE threatens to leave New York