The Financial Services Authority has warned that the EU's Markets in Financial Instruments Directive (Mifid) will cost London’s financial district £1bn.

The new rules are designed to create a single market in financial services.

But the FSA said that while Mifid could generate £200m a year in ongoing benefits, the rules were likely to land companies with substantial one-off compliance costs.

It may these predictions as part of a formal assessment published over the weekend.

The report, said the industry would be stung with a one-off implementation costs of between £870m and £1bn, with ongoing costs of an extra £100m a year.

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