Singapore has been ranked third in the Global Financial Centres Index (GFCI), behind London and New York, according to a new report published by the City of London. In Asia, Singapore surged past Hong Kong to move into third place overall, albeit by only one point.

Singapore gained 26 points in the index, more than any other top-20 centre, which allowed it to overtake Hong Kong. Hong Kong has been ranked fourth this time round. The GFCI is updated every six months in March and September. This report is the fourth edition.

London and New York still lead the field and ‘continue to be the only two truly global financial centres’, the report said. Both cities, hit by the credit crunch, shed points in this round of the GFCI. But London’s lead as the main banking centre in Europe is consolidated as Frankfurt and Paris have both declined in the ratings relative to other centres, the report noted.

Singapore’s 26-point gain also means that the gap between London and New York, and the third place centre fell to 73 points, from about 90 points in previous rankings. Singapore is just ahead of Hong Kong in the banking, insurance and government & regulatory sub-indices and is also ahead in the business environment sub-index. But Hong Kong continues to thrive, the report said.

The GFCI also noted that financial centres in the Middle East continue to generate a lot of interest. Dubai is identified most frequently by respondents as the centre likely to become significantly more important in the next few years; Singapore is second in this respect.

Dubai is also the centre mentioned most often when respondents are asked where their organisations are most likely to open offices in over the next few years.

The GFCI model rated 59 financial centres in this round. The study uses external instruments – such as the United Nation’s Human Development Index and the World Bank’s Ease of doing Business Index – as well as responses to an online questionnaire from 1,406 financial services professionals.

Source – Business Times