EU doesn't need the City of London, says chief Brexit negotiator

Michel Barnier torpedoes Theresa May's hopes of a gold-plated deal for UK financial services

The EU does not need the City of London, and Theresa May's "pleading" for a special deal for the UK's financial services sector will not be rewarded, the EU's chief negotiator, Michel Barnier, has said.

In his toughest rebuff yet to the demands made by the British prime ministerin her landmark Mansion House speech, Barnier suggested the City would be granted nothing more generous than that enjoyed by Wall Street.

Banks, insurance companies and other financial firms in the EEA - the EU along with Iceland, Liechtenstein and Norway - are able to do business in the UK with separate regulatory approval. The system is known as passporting and allows firms to trade freely across borders. It applies the other way round, so that UK firms can operate in other EEA countries.