In the courtyard of London's historic Guildhall late last month, groups of happy students in gold and purple robes were throwing mortar boards skywards. They had just graduated with Masters degrees from Cass Business School.

As their faces and languages suggested, Cass students come from all over the world, a living demonstration of the diversity which for so many students is London's appeal.

Attracted by that, and by the chance to stay and work in Britain for two years, postgraduate students are pouring into London in ever greater numbers. Though competition for City jobs is now intense, the number of business courses – particularly Executive MBAs, which can be taken part-time – has rocketed.

Four British institutions still dominate the capital's MBA scene. By far the largest is the top-ranked London Business School (LBS), with an annual intake of more than 300 MBA students and an elegant site near Regent's Park.

Providing top-level competition is Imperial College Business School in Kensington, west London, with a shiny new building and a slimmed-down MBA course taking about 50 students a year.

In 2001, the world-renowned London School of Economics (LSE) entered the market with its Trium Executive MBA programme, in partnership with New York's Stern School and HEC School of Management, Paris. LBS runs a similar EMBA with Columbia Business School.

Finally, at Bunhill Row, near the heart of the City, Cass also has a modern building, including two trading rooms, Reuters and Bloomberg. Its MBA can be taken full-time or part-time.

In the last few years, however, three other high-class MBA players have muscled into London, opening campuses in the capital: they are Grenoble, ESCP-EAP and Chicago.

Grenoble Graduate School of Business has a triple-accredited MBA taught full-time in France and part-time at the London School of Business & Finance (LSBF), which occupies a modern suite of offices near Chancery Lane in Holborn. The LSBF itself is a fledgling independent school that has grown rapidly since its foundation in 2003.

For postgraduate students, LSBF offers the chance to take the Grenoble MBA while at the same time acquiring a professional qualification in accountancy (ACCA and CIMA) or marketing (CIM). It also offers a financial services qualification (CFA) in conjunction with an MBA awarded by the University of East London.

"By offering students dual qualifications, we give them something more practical and technical than is sometimes offered on MBA courses," says Valery Kisilevsky, LSBF's managing director. "We have a two-year full-time MBA and a part-time version, and two intakes a year of about 50 students."

ESCP-EAP, Grenoble's French rival in London, has a long history. Owned by the Paris Chamber of Commerce (as indeed is HEC), it prides itself on being the world's oldest surviving business school, with a history going back to 1819.

"That's about 80 years before Harvard Business School," says Davide Sola, its ebullient head, who is himself a product of the school, having taken its trademark three-year course in three European locations before joining McKinsey. Today's EMBA students have the choice of modules in Paris, Berlin, London, Madrid and Turin and two non-European countries.

Until 2004, the school was in Oxford. Now it is based near Hampstead, north London, in a converted seminary, complete with stained glass. It offers a highly-ranked pre-experience Masters in Management (average age 22), a Masters in European Business, and an executive MBA with an average age of 30.

Is its location several miles from the middle of London a disadvantage? "No, it's wonderful," says Sola. "It's a village feeling but we're 20 minutes by Tube from the centre. When people study they should be in a place where they can reflect and work. Students often go for walks on nearby Hampstead Heath."

There is no slow contemplation, though, in the school's trading classroom, where students – mostly from Europe but with growing numbers from India, China and South America– jostle to outwit each other online.

Sola's students are unperturbed by recession. "Many of them did not grow up in an Anglo-Saxon world," he says. "They do not perceive this crisis to be as deep as perhaps they have seen at home."

It was London's rapid growth in financial services that persuaded the world-renowned Chicago Business School to move its satellite campus from Barcelona to London in August 2005. The school's new premises in Basinghall Street, right next to Guildhall, could not be more central.

Does the school regret the move now that London's position as a financial centre is in decline? "Not at all," says Glenn Sykes, the director. "We're pretty thrilled with the outcome, even in this tough year. There's been no second-guessing.

"Of course people are concerned about jobs. We don't run a full-time MBA programme here, so the people on our programme are employed, but a lot of our alumni are in financial services."

Sykes sees no change in London's future as an extremely important city in the world of business, including financial services. "There's too much talent and expertise for that picture to alter much."

Now renamed Chicago Booth, after a donation, the school prides itself on its single-model, no-partnership approach and has no plans to go into partnership. "We saw a lot of business schools forming agreements with other schools," says Sykes. "It'll be interesting now that times have changed to see whether there continues to be support from each respective organisation. Those agreements have to have transaction costs."

That is a message, perhaps, that in these straitened times, it will be the schools that can tighten their belts that will survive.

'I wanted more knowledge of other functions'

Emily Abols, 33, who is from Venezuela but based in London, is taking an 18-month Executive MBA with ESCP-EAP.

"I had been working in London in advertising and marketing but I wanted more knowledge of other business functions. So I looked at different courses and schools. This school attracted me because of its location and the one-year general management progamme, which takes you across the basics of the MBA subjects.

Having finished that, I thought why not carry on and do an MBA? The idea of being able to take all the modules in different countries was amazing – you meet people from so many different backgrounds

I started in January, in Paris, with organisational behaviour. The EMBA is a combination of core modules, seminars and electives – mine will be in leadership and finance, both areas where I felt I needed to develop more knowledge and practical skills.

Finance was very hard but the teaching was very good. London has definitely got a future. I come from Latin America, where we live in crisis, with endless inflation. Here the economy is pretty stable."

'Everybody's talking about business and finance'

Vygandas Jankunas, 38, took an MBA in London with Grenoble Graduate School of Business, studying part-time while also studying for a qualification with the Association of Chartered Certified Accountants (ACCA).

"I was working as a finance manager with Peugeot in Brussels but I wanted to escape the totally French environment. When you come to London you have a strange impression – it's as if there's something in the air, flying around you. Everybody's busy, everybody's talking about business and finance. It's very exciting.

During the week I was doing ACCA and during Friday, Saturday and Sunday it was the MBA. The ACCA is very demanding but gives you a deep technical background. That helps to enrich the MBA class discussions. More and more, managers nowadays need to know the implications of their strategic decisions.

The course was at the London School of Business & Finance in Holborn. I took out a loan of €50,000, which covered the courses and the living costs for two years. It was a student life, but great fun.

Grenoble is a famous school and the MBA has already helped me to change my job – I'm with the European Commission now, working with the European Investment Fund."

London: where will the jobs be?

The banking crisis is bound to change London's jobs market, says Steve Haberman, deputy dean of Cass Business School, which has the largest actuarial science and insurance department in Europe.

"Actuaries have been moving gradually into less traditional roles. There are going to be many more positions in areas such as financial risk management in insurance and in banks. The rocket scientists may not be moving into trading but they are moving into supporting risk management. There's been too much focus on where the banks sit day to day and not enough on the long-term implications of what the banks do, which will mean jobs on the insurance side.

"London will adapt and so will courses within business schools. We're doing a quick but extensive review of where business ethics sits in all of our degrees. We teach it to MBAs but we're going to strengthen what we do for other students.

"In some ways medicine is ahead of us here with its Hippocratic oath. Perhaps that's what finance workers need."