Major Chinese state-owned banks are becoming increasingly eager to escape the tough levels of regulation seen in the City of London.
These financiers have indicated to the UK government that they are looking to switch significant parts of their European business to Luxembourg as rules surrounding lenders continue to get tougher in Britain's monetary hub, the Financial Times reports.
In a letter to the Treasury issued through the Association of Foreign Banks, these companies cited a combination of "rigorously demanding" liquidity rules and uneven regulation, which has acted as a catalyst for them to move elsewhere.
As such, the likes of the China Construction Bank, the Agricultural Bank of China and the Industrial and Commercial Bank of China are "finding it increasingly difficult to operate in the UK under the current regulatory environment", the letter noted.
The main reason for Chinese banks' dissatisfaction is the Financial Services Authority's refusal to allow them to establish branches in London.
By Gary Cooper