Europe's three big stock exchanges have been jacking up charges and increasing revenues from equity trading while their customers have been suffering, according to a confidential report prepared for the London Investment Banking Association ( Liba).

The report, which focuses on cash equity trading, asks whether the three have been abusing their position as domestic monopolies to increase prices. Despite the bear market of the past three years, the study shows that exchanges increased the unit cost of trading and improved their profit margins. It also provides an in-depth analysis of the relative cost of trading equities on the London Stock Exchange (LSE), Euronext and Deutsche Börse, concluding that the Frankfurt exchange is the most expensive.