Regulation since the financial crisis has imposed an annual cost of £26bn ($37bn) on the world’s largest investment banks’ capital markets activities, a recent study has found.

The cost is the equivalent to almost two-fifths of the expenses drawn up by capital markets in 2016, according to a report commissioned by the Association for Financial Markets in Europe (AFME).

he research covered 13 of the biggest investment banks that work across Europe including J.P. Morgan, Goldman Sachs, Barclays and HSBC.

The research has been conducted with the aim of calculating the costs of regulation to banks before any changes to operating models prompted by those same regulations, such as reducing activity in markets made less profitable.

However, the study did not take into account further, broader costs or benefits to financial stability from banks being forced to change models.

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