UK bank bosses demand policy stability ahead of critical budget

Bank leaders in London are urging for clearer and more stable policies amidst concerns that upcoming tax increases in the upcoming U.K. budget could impact the financial services industry.

In interviews with CNBC’s Steve Sedgwick and Ritika Gupta in London’s Canary Wharf district, CEOs from Barclays, Citi, and J.P. Morgan mentioned the successful navigation of the disruptions caused by U.S. President Donald Trump’s tariff uncertainty in April. They highlighted stronger corporate profitability and an improved deal-making environment in the financial services sector since then.

However, they expressed caution regarding potential tax hikes in Finance Minister Rachel Reeves’ Autumn Budget on Nov. 26.

During the summer, reports suggested that Reeves was contemplating a bank windfall tax to address a significant gap in public finances.

“Competition is vital for growth, which is why excessively taxing the financial sector is detrimental as it hinders investment,” said Barclays CEO C.S. Venkatakrishnan.

Venkatakrishnan emphasized the need to encourage growth in London, one of the world’s major financial hubs, rather than taxing it out of existence.

He acknowledged the U.K. government’s overall positive direction but cautioned about the importance of a consistent approach to bank regulation, capitalization, and taxation to maintain competitiveness.

“The world is our oyster, the U.K. is our home, and we must collaborate with both,” he stated.

Conor Hillery, deputy CEO and head of investment banking, EMEA, at J.P. Morgan, stressed the necessity of policy stability and certainty for investors and companies in making decisions and planning.

Hillery highlighted London as Europe’s premier capital market and noted increased deal activity and optimism, supported by global economic resilience and strong corporate profitability post the U.S. tariff turmoil.

He mentioned a growing interest in U.K. listings and viewed the recent $202 billion investment from U.S. companies as a vote of confidence in the U.K.

Citi U.K. CEO Tiina Lee, addressing impatience in markets for reforms and clarity, acknowledged the government’s recognition of banks’ role in Britain’s growth trajectory.

She highlighted the need for time for legislative changes to take effect despite the government’s vocal stance on maintaining London’s financial center competitiveness.