Big Bang 1986

About Big Bang 1986

The Big Bang of October 27, 1986 deregulated the London Stock Exchange. It eliminated fixed commissions, ended the separation between brokers and jobbers, and allowed foreign ownership of British brokerage firms. The reform transformed London into a global financial center. American and European banks rushed in, buying British firms. The floor trading system was replaced by electronic screens. The Big Bang created the modern investment banking industry in London. Critics argue it reduced competition by concentrating power in a few mega banks. The City of London became a rival to Wall Street, especially for European and derivatives business.