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    첨부파일 첨부파일 Presentation Transcript

    • Competition in the Service Sector UK Experience – How the UK's financial services sector became successful Sir David Wright Vice Chairman, Barclays Capital
    • Competition in the Service Sector: UK Experience
        • Underlying Principles
        • Freedom for innovation
        • Flexibility
        • Light touch regulation
        • Welcome to foreigners
    • Competition in the Service Sector: UK Experience
      • History:
        • London's growth reflects long business history
      • Barclays:
        • Founded in April 1690 by John Freame Partnership in 1733 with James Barclay
        • Family banks run by Puritan – Non conformist Entrepreneurs, interconnected by marriage
        • Boosted by financial needs of Industrial Revolution customers originally wealthy individuals
        • By 1840: taking deposits and lending to shopkeepers and businesses
        • Barclay and Co set up as Joint Stock Bank in 1896, controlling 1 / 4 of deposits in English market
        • By 1939, 1 / 5 (2500) of all bank branches in England
    • Competition in the Service Sector: UK Experience: London Emerges
      • London Market
        • 1815 – 1914 London as top-dog, attracting talented foreign financials eg Rothschilds
        • 1914 – 1960 Two World Wars and US Dominance
        • 1960 – 1987 London's rebirth largely because growth of Euromarkets, US$ dominated offshore Dealings
        • Driven out of US by restrictive controls in New York
          • Short-term Eurodollar money market
          • Long-term Eurobond capital market
          • Both attracted to London by light regulatory touch of Bank of England
        • International Euromarket focused City
        • UK-oriented City focused on domestic securities market
        • But 1987 changes all that
    • Competition in the Service Sector: UK Experience: Why a Big Bang?
        • National mood: middle of Thatcherism – privatisation, trade union reform, pressures for change. No hiding places e.g. women allowed on London trading floors
        • Pressures for wider share ownership from privatisation: resentment of old, closed world of stock market. Office of Fair Trading challenge to restructure practices in 1984
        • Attraction of electronic trading methods: existed in international eurodollar market
        • End of discount house monopoly on issuing government securities
        • Law of unforeseen consequences: Big Bang unleashed forces in unexpected areas
    • Competition in the Service Sector: UK Experience: Big Bang
        • The crucial change, 27 October 1986
        • Reforms included:
          • Reform of stock market to combine functions of stockbrokers and stock jobbers
          • Introduction of the Stock Exchange Automated Quotation system replacing the trading floor with a screen based quotation system
          • Abolition of restrictions on ownership of UK stockbrokers
        • Focus on stock market, but effects more wide-ranging
        • Rationalisation of ownerships of financial services companies both through merger, integration and absorption by others
        • Especially, banks become owners of securities companies
        • London's international and domestic markets merged into one
    • UK Financial History (1945 – 2003)
    • Competition in the Service Sector: UK Experience
        • Underlying Principles – Visible in History
        • Freedom for innovation
        • Flexibility
        • Light touch regulation
        • Welcome to foreigners
        • : Big Bang
        • : Merger of banks and Securities companies
        • : Attracts Eurodollar market
        • : Takeover by US and foreign companies
    • Competition in the Service Sector: UK Experience: Main Advantages
        • Historic
        • History of business openness since 17th Century coffee ships
        • Strong trading culture since 18th Century
        • English language
        • Quality of life
        • Flexible immigration
        • Central position between US and Asian time zones
        • Tradition of innovation
        • All companies treated as UK companies
        • No criticism of foreign capital
      • Actual
        • Critical mass of firms in one location
        • Availability of multi-national labour
        • Availability of linguistic skills, 300+ languages spoken
        • Flexible residence authorisation for non-citizens
        • Support services global leaders: accountancy, legal and actuarial skills, IT, innovative marketing
        • Beneficial tax regime, personal and corporate
        • Logistic and transport centre
      Regulation: Principles based not Rules based Current debate over London/New York and SarBOx
    • Competition in the Service Sector: UK Experience: Timing
        • Post 1987 Big Bang, global economic circumstances ideal for growth
        • International bond market boomed
        • International banking grew
        • Derivatives origination and trading expanded
        • Professional services (legal and accountancy) grew though corporate finance and securities issuance
        • Equities boomed 1995 – 2000
        • Foreign exchange trading expanded
        • Corporate finance activity expanded through global M&A activity
        • Euro trading furnished a new market
        • All developments on which London was able to capitalise
    • Competition in the Service Sector: UK Experience
      • Survey 2 – 3 years ago of London Services
        • London is world leader with:-
          • 20% global cross-border bank lending
          • 32% global market for foreign exchange
          • 43% global OTC derivatives
          • 80% European Hedge Fund assets
          • 33% Global FX trading
          • 2nd largest centre for exchange traded derivatives
          • 60% issuance of euro-denominated eurobonds
          • 70% secondary trading in international bonds
          • 65% global foreign equity turnover
          • 90% of euro denominated short-term interest rate controls
          • 95% global base metals traded by LME
        • Euro: in effect London is "in" EMU
    • Competition in the Service Sector: UK Experience
      • Breadth and Depth:
      • 8.5% UK GDP in Financial Services Associated professional services as additional 3.6% GDP
        • Banking industry: 383 authorised banks (255 foreign) Assets – £6.2 trillion ( 1 / 2 held by foreign banks)
        • Investment banking: Fee income $53 billion (2005) 51% from US; 31% from Europe; 18% from Asia 1 / 2 European investment banking conducted through London
        • Insurance: UK insurance industry No 3 in world, largest in Europe UK largest source of insurance funds and pensions in Europe
        • Employment: 1 million employed in financial services 240,000 in City and 78,000 in Canary Wharf
        • Business and Professional Services: London Base for largest law firms in Europe 2,900 Accountancy firms in London Big 4 have major London presence London is home to 5 top advertising agencies Plus Management Consultancy, Market Research, Computer Services, Equipment Renting
    • Competition in the Service Sector: UK Experience
        • Underlying Principles
        • Freedom for innovation
        • Flexibility
        • Light touch regulation
        • Welcome to foreigners
        • : Derivatives origination
        • : Growth of Hedge Funds
        • : Principles not rules based
        • : 225 foreign banks
    • Competition in the Service Sector: UK Experience Citi refocuses on London as core for its global business The bank, which had previously based product heads in the US, is moving senior personnel to London "While previously none of the heads and co-heads of the business were based outside the US, we now have six out of 13 product heads based in London" "This is a reflection of the fact that we think there are major opportunities in Europe and it is easier to run a global business from London with the time zone advantage" "There have been a lot of things written about the emergence of London as a financial centre and I guess this is another good example of the trend" February 2007
    • Barclays Capital overview Barclays Group profile
        • Barclays is an international financial services group engaged primarily in banking, investment banking and asset management
        • One of the most established financial services companies
          • Barclays has been involved in banking for over 300 years 1 and operates in over 60 countries with over 123,000 employees
        • One of the highest credit rated financial services companies
          • Barclays is highly capitalised with a balance sheet of over £996 billion 2 and ratings of AA from Standard & Poor’s, Aa1 from Moody’s and AA+ from Fitch
        • Profit (pre tax) – underpins healthy business performance
          • Full year 2006 £7.136 billion
          • Full year 2005 £5.280 billion
          • Full year 2004 £4.603 billion
          • Full year 2003 £3.845 billion
          • Full year 2002 £3.205 billion
          • Full year 2001 £3.425 billion
          • Full year 2000 £3.392 billion
      Global Retail & Commercial Banking Notes : 1 Original banking business established 1690. 2 February 2007. SL003 Investment Banking & Investment Management Barclays Capital Barclays Global Investors Barclays Wealth Barclaycard International Retail & Commercial Banking UK Banking Barclays PLC
    • Competition in the Service Sector: UK Experience
      • Conclusions:
        • Four underlying principles provide basic causes of success
        • Additionally
          • Timing
          • Ownership
          • Political non-interference
          • Ripple effects: jobs, business creation
          • Trading tradition
          • Living environment
          • Logistics/transport centre
        • Non-financial causes as important as financial