(Bloomberg) --
The European Union's commissioner for financial services said the bloc's reliance on London's clearing infrastructure isn't feasible in the medium term, underlining the EU's ambitions to bring more of the business into the bloc.
The reliance on third-parties is “not sustainable,” Mairead McGuinness said at a Banque de France conference Tuesday. She said the European Commission would continue to work to encourage migrating that activity to the continent.
Her comments come after the EU said it would extend a temporary waiver that allows its banks and money managers to clear trades in the U.K. McGuinness reiterated Tuesday that the decision was made to prevent any short-term financial instability and wasn't a strategic change of heart.
Clearing is a key part of the finance world supporting banking, technology and legal jobs across the City of London. Clearinghouses such as the London Stock Exchange Group Plc's LCH operate at the center of markets, collecting collateral from both sides of a trade to ensure a default on one doesn't spread panic through financial markets.
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