City of London could be cut off from Europe, says ECB official

London-based institutions could be stripped of 'passports' that allow them to sell services to rest of EU, says Franiois Villeroy de Galhau

The European Central Bank has fanned fears that London could lose its status as Europe's financial capital after warning that the Brexit vote might sever the City's trade relationship with the EU.

A top ECB official said banks in the City of London risked being stripped of their lucrative EU "passports" that allow them to sell services to the rest of the union. Franiois Villeroy de Galhau said keeping the so-called "passport" would not be possible if the UK leaves the single market of trade in goods and services.