The trading floor of the stock exchange in Frankfurt. MICHAEL PROBST AP/Press Association Images LONDON - Germany's financial centre, Frankfurt, is set to grab a huge chunk of the City of London's business post-Brexit, aided by themerger between the London Stock Exchange and Deutsche Boerse.

According to a research paper commissioned by Deutsche Boerse, and published by Professor Dirk Schiereck of the Technische Universität in the German city of Darmstadt, Brexit "will make Frankfurt the clear European centre for financial market regulation and simultaneously, Frankfurt might indeed become the European centre for supranational risk management."

Frankfurt could steal billions of pounds worth of business as a result of the merger, which may allow Deutsche Boerse to move significant portions of the LSE's derivatives trading from the UK to Germany.

"Deutsche Börse has a good chance of winning significant long-term market share in the areas of interest rate and currency trading and relocating trading from London to Frankfurt if the market participants in London are given unrestricted access to superior trading platforms in Frankfurt," Schiereck writes in the paper, titled "Why the merger between Deutsche Börse and the London Stock Exchange will strengthen Frankfurt as a financial centre."

Schiereck's paper cites the example of Bund trading in the 1990s as reason to believe trading can move from London to Frankfurt. "The migration of Bund futures trading from London to Frankfurt in the 1990s can serve as an example here," he writes.

The paper is just the latest in a series of threats to the City's role at the heart of European financial markets. Almost all major banks are thought to be considering moving jobs away from London after the Brexit process formally begins, with HSBC's chairman Douglas Flint saying last week:

"We would take pre-emptive action in order to ensure that we have the capacity in place in order to be able to continue to deliver what we deliver today from a different set of arrangements."

The bank currently expects to move roughly 1,000 jobs to "France, or indeed to Ireland or Holland or any other place within Europe that we have operations."

Financial centres across Europe are battling it out to take business from London, with Frankfurt and Paris currently seen to be in poll position. French lobbyists have made frequent trips to London to meet with business leaders and market participants in recent months.

There are two big areas of concern when it comes to London's role at the heart of European finance — financial passporting, and the clearing of euro-denominated trades in the City.

Current EU law allows European banks to operate branches in the UK that do not need to be separately capitalised from the parent company abroad. Similarly, non-EU banks, such as those from the US or Asia, can use their London subsidiary to sell services to clients across the EU. This has allowed London's financial centre to act as a hub for global firms looking to do business in the EU.

The use of this bank "passport," which allows banks in London to access the EU single market of 28 nations (including the UK), could be one of the rights the UK loses in the British exit from the EU.

It is now looking increasingly likely that the UK could lose the passport should Britain opt for hard Brexit, although over the weekend a story in The Guardian suggested that the one of the EU's most important Brexit negotiators, Michel Barnier, wants a "special" relationship with the City of London after Britain has left the bloc.

You can read Schiereck's full paper here.