LSEG chief dismisses criticism that London is losing its allure as a financial hub as ‘clickbait’: ‘I think that narrative is overplayed’

Britain has seen companies departing from the country for a few years now, opting instead to list in New York over London. British chip-maker Arm is a case in point, as it recently made its public debut on the American tech-heavy Nasdaq index, valued at about $55 billion. This trend has got many observers speculating that London may be losing its attractiveness as an investment hub.   

But the chief of London Stock Exchange Group, which runs Europe’s major stock exchange in London, has slammed such criticism, arguing that the English capital remains a key financial destination.

“Anything that is seen as negative commentary about London as a financial centre has become kind of clickbait,” LSEG CEO David Schwimmer told the Financial Times Thursday. “I think that narrative is overplayed.”

Schwimmer’s comments come at a time when London is trying to revive its position as a sought-after European financial center. For the first time in five years, London didn’t make a list of the top five cities with the most number of Fortune Global 500 companies. 

The city has faced its fair share of setbacks—companies like Arm, building giant CRH and equipment supplier Ferguson have chosen to list across the Atlantic for the want of wider market access, potential for higher valuations and fewer regulatory barriers. 

While these may have further impacted London’s allure in the financial world, Schwimmer insists that the city is still a promising destination.

“There’s a sense that you can’t be a global champion from here . . . [London] is a great place for us to be operating from,” he said. 

In an effort to bolster London’s capital markets, the LSEG is planning to launch a platform next year to trade in shares of private companies. The goal of the new LSE venue is to provide more avenues of liquidity to companies that are rapidly scaling up.

“There are many companies that would prefer to remain private but also want to enable a liquidity event for their shareholders or welcome new investors,” Schwimmer said.

The LSEG didn’t immediately return Fortune’s request for comment.

Where does London stand?

London’s recent activity (or the lack of it) has happened against the backdrop of Brexit-linked fund outflow as investors placed their bets in other European hubs instead. High inflation and elevated interest rates have also shaped its economic reality this year. So far in 2023, the LSE has seen just 16 IPOs compared to 26 during the same time in 2022, the FT reported.

“London’s position has come under threat from a number of challenges including rising costs—its success has made it a relatively expensive city—a slowdown in U.K. economic growth, the impact of COVID, and Brexit,” consultancy Oxford Economics’s associate director Tim Lyne told Fortune last month.

Despite the hurdles that London and Britain face, the case for doing business in the city has always been clear—its proximity to Europe and the rest of the world and its history as a trading stronghold make it an important financial center. Lyne said that London will continue to be significant in a global sense, even if the degree of it has changed in recent times. 

Some of Britain’s most prominent personalities have also been trying to make a fresh case for why London is still a great place to invest—because it’s boring. As the country’s political and economic uncertainty begins to settle, its predictability could become its strong suit, according to the chancellor of the exchequer, Jeremy Hunt.

“I think it’s about being nimble and reacting to changes. But doing so in a predictable way,” he told the Wall Street Journal. “That’s the way that you encourage the most investment.”