European regulators are considering making it easier, at least temporarily, for banks to handle some EU-related business in the UK immediately after Brexit, according to industry sources.

The head of Germany's financial regulator has warned that firms in the City of London are at increasing risk of a "cliff-edge" Brexit, as he urged banks wanting to relocate to the country to speed up their applications.

As Britain prepares to negotiate its EU departure, a number of banks are likely to decide within two months where to set up new continental bases to make sure they can keep serving clients in the bloc after Brexit.