Project Fear predicted a Brexit apocalypse for the City. It never happened

Dia ChakravartySat, June 20, 2026 at 5:00 AM UTC

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Ten years, London has bolstered its status as a global financial centre - Karl Hendon/Moment RF

In the spring of 2016, the Policy and Resources Committee of the City of London Corporation made an historic declaration. By 17 votes to three, its members had decided that the governing body of the Square Mile would support the United Kingdom remaining a member of the European Union in the upcoming referendum.

In his attempt to explain the City's extraordinary decision to adopt and express a corporate view on one of the most politically charged debates of our times, the then chairman of the committee Mark Boleat, since knighted, highlighted two significant factors.

One would seem to serve as a reminder of the strength of the establishment's anti-Brexit stance. This was not a party political issue, Sir Mark said: "Wherever possible we support the Government of the day, and on this issue we would be supporting the [Conservative] Government in a view that is shared by the Labour, Liberal Democrat and Scottish National parties."

The second is a testament to the success of what Brexiteers remember as the Remain campaign's "Project Fear" in convincing Britain's financial services industry that it was crucial economically for the country to retain its membership of the EU.

Prime minister David Cameron had declared Brexit "the self-destruct option for the country", and chancellor George Osborne had predicted a year-long recession, with up to 820,000 jobs lost within two years. Likening it to the anxiety gripping the Square Mile back in the 1990s when it became clear that the UK would not be joining the euro, City sources remembered "an atmosphere of unease", as panic set in.

David Cameron repeatedly warned the British public that voting to leave the European Union would be a 'self-destruct option' - Geoff Caddick/AFP

One of the most high-profile interventions from within the industry came from JP Morgan. Chief executive Jamie Dimon initially warned of his bank cutting 4,000 jobs in the event of the UK leaving the EU. After the vote and during the Brexit negotiations, the warnings escalated as Mr Dimon revised his job loss estimates up to a more dramatic 16,000 "if we can't find reciprocal recognition of rules" with the EU, posing "a real threat to the future success of London as a financial centre", as reported by the BBC.

The JP Morgan boss did not shy away from suggesting that his pessimism over reciprocal recognition rules being negotiated between London and Brussels was due to the EU's wish to punish the UK, with "a lot of people" being "mad with the Brits for leaving and want[ing] their pound of flesh".

London's loss was going to be Paris, Frankfurt or Berlin's gain, as European leaders such as the "new darling of Davos", the then 39-year-old French president, Emmanuel Macron, dialled up the charm offensive.

Mr Dimon's instincts were partially correct: our pound of flesh was indeed claimed. The UK has not been granted broad reciprocal recognition of its rules by the EU, despite us granting our own recognitions more flexibly in some areas. Post-Brexit UK-EU financial services cooperation continues to rely on a combination of limited equivalence and regulatory dialogue.

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The punishment is also reflected in the fact that Britain has been granted fewer equivalence decisions (which reduce regulatory complexity for British-based firms operating in the EU) by Brussels than other third countries like the US. The EU also retains the right to withdraw equivalence with notice.

But Mr Dimon was wildly off the mark on his predicted exodus of City workers.

JP Morgan chief executive Jamie Dimon shifted services to Paris following Brexit - Mike Segar/Reuters

"At the time of Brexit, CityUK endlessly cited their study forecasting Brexit would mean 75,000 job losses", remembers Lord Lilley, the Conservative grandee who, as Mrs Thatcher's trade and industry secretary, oversaw Britain's entry into the Single Market. "It didn't happen. There are now more people employed in financial services in Britain than before Brexit."

Certainly, the predictions of a collapse in the numbers of financial services jobs did not become reality. Indeed, JP Morgan is reported to be one of the top employers to have "ramped up efforts to hire workers in the year after Brexit". According to research by recruiter Morgan McKinley and data-analytics firm Vacancysoft, finance firms in England and Wales "tried to hire just over 87,000 workers [in 2022], the highest level recorded by the two organisations and up more than 27 per cent on 2021".

In April, it was reported that JP Morgan was returning some jobs from Paris to London, having bulked up its French operations after Brexit. The bank employs 13,000 staff in London. It is unclear how many of its 1,000 Paris-based employees are moving to London, but the bank has announced plans to build a new 3-million-square-foot tower in London, resulting in a projected £10bn to be injected over the next six years into the local economy.

Goldman Sachs, a City giant named in Sir Mark's speech as among those urging the UK to remain in the EU, has invested £1bn in its new headquarters in Brexit Britain. London also remains a leading global centre for financial technology, which accounts for 38 per cent of our "unicorns" – startups projected to be worth more than $1bn in a few years.

Chasing unicorns

It was reported last year that London bred more unicorns than Paris, Berlin and Amsterdam combined. Placed fifth in the global league table, London is behind only San Francisco, New York, Shanghai and Beijing, with "the combined value of British unicorns tripling from $54bn in 2020 to $172bn in 2024".

It is a small wonder that "the City has done an about-turn and successfully lobbied the government to exclude financial services from dynamic alignment with EU law in the planned reset," said Lord Lilley.

Ten years on from Brexit, London has bolstered its status as a global financial centre, diversifying beyond the EU. "City firms welcome Britain taking back control of our law," said Lord Lilley. "They benefit from the Wholesale Markets Review, Listing Overhaul, bonus cap removal, and, not least, the competitiveness objective for our regulators, but, above all, escaping the never ending stream of new EU regulations."

It was JP Morgan analysts who had mocked Boris Johnson's Brexit plans, declaring, a "unicorn with a lick of paint is still a unicorn." Some unicorns, it transpires, are worth pursuing.

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Source: “AOL Money”