'Turning point': Brussels and London strike deal to boost financial services cooperation

The agreement will establish a forum through which the two sides will discuss voluntary regulatory cooperation on financial services issues.

Jeremy Hunt, the British finance minister and Mairead McGuinness, European Commissioner for financial services, signed the Memorandum of Understanding (MoU) in Brussels.

McGuinness told reporters that although the UK is no longer in the EU, "we still share many of the same issues and challenges like fighting financial crime, supporting sustainable finance and enabling digital finance. So it's really positive that we've had this structured cooperation in place."

Hunt, meanwhile, said the UK is "absolutely delighted" with the MoU. "We also see it as an important turning point. We have a shared interest in global financial stability.

"The UK is the biggest financial services sector in Europe and we have a particular responsibility to work closely with the EU to make sure that both sides are doing more, to make sure that we have that stability that is so important.

"We see this very much as not the end of the process, but the beginning," he added.

The aim is for the forum to meet bi-annually with the first meeting scheduled in the autumn.

A spokesperson for the European Commission stressed however that the forum "does not restore UK access to the European Union".

The financial services sector is hugely important for the British economy with the sector contributing £173.6 billion (€201 billion) in 2021, equivalent to over 8 per cent of total economic output.

The country's exit from the EU, finalised in January 2020, had stoked fears that London's place as a leading global hub for financial services could be weakened by more restricted access to the EU.

But the impact has been more muted than