LONDON (Reuters) - Optimism about the business environment among Britain's financial services firms declined in the second quarter of this year, according to a survey published on Tuesday.
The latest quarterly survey of 94 financial services firms by business lobby CBI and consultancy PwC found sentiment about Britain's overall business climate deteriorating, with banks and life insurers especially pessimistic.
The report adds to a string of lacklustre data showing the British economy weakening.
Optimism in the financial services sector - Britain's biggest source of tax revenue - has now declined in five out of the last six quarters.
"Whilst business activity is holding up strongly, optimism took another dive, which likely reflected a mix of Brexit uncertainty and concerns that financial market conditions could tighten," said Rain Newton-Smith, CBI chief economist.
Britain will have to negotiate new trading terms with the EU and it is unlikely banks will retain access to sell their services and serve clients across the economic bloc.
The largest global banks in London plan to move thousands of jobs to the continent in the next two years.
Firms expect to cut back on most forms of capital spending, the survey showed.
Reporting by Andrew MacAskill; editing by Andrew Roche