Brexit negotiations are approaching "crunch time" as far as Britain's financial sector is concerned, a prominent lobby group said on Thursday (21 September).

The City UK has reiterated that the UK economy as a whole, and firms in the financial sector in particular, would require a transitional period as Britain withdraws from the European Union.

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The government has repeatedly reassured businesses that their voices will be heard in the negotiations, but financial sector firms want clarity as a number of companies have already made plans to move business away from Britain.

The warning comes ahead of Theresa May's much-anticipated speech on Brexit in Florence on Friday (22 September) and the lobby group warned the UK runs the risk of losing its role as Europe's financial hub.

"For our industry, this really is crunch time," The City UK chief executive Miles Celic said. "Many firms are already moving parts of their operations out of the UK and Europe. When they've gone, it's hard to see them coming back.

"Even if the UK and EU agree the best possible Brexit deal by 2019, without urgent clarity on transitional arrangements, business will assume the worst and act accordingly."

A spokesperson for the government said the Prime Minister and her cabinet remained committed to ensure businesses were given "as much certainty as possible" during the Brexit process.

"We have been clear that we believe a time-limited, implementation period is in the interests of both the UK and the EU and that negotiations on the future partnership should begin as soon as possible," the spokesperson said.

"We have intensified our engagement with the business community to ensure their voice is heard and reflected throughout our negotiations giving them as much certainty as possible as we move through the exit process."

Earlier this week, a survey suggested around 10,000 finance jobs will be shifted away from the UK in the coming years if the country leaves the single market.

Nearly half of the 123 firms polled by Thomson Reuters, among which were banks, insurers, asset managers, private equity firms and exchanges, said they would have to move staff or restructure their businesses due to Brexit.

A third of firms said the UK's exit from the European Union would have no impact on their businesses, while the remainder said they were still making plans.

"If it is going to happen it won't be in one big bang," a senior executive at a European bank, who participated in the survey, told Reuters. "There will be a slow drain of jobs from London over a number of years."

Last week, business leaders that employ nearly a million people in the UK and the European Union signed an open letter calling for a three-year transition period after Brexit.

The letter, which was drawn up by the Confederation of British Industry, calls for negotiators to clarify the rights of UK and EU citizens working abroad by the end of October.

It warned that "continuing uncertainty" over future arrangements would adversely impact businesses and calls for trade to be discussed before the end of the year.