In its 31-page Global Research report, the Bank of America Merrill Lynch warned that overseas investors could be “deterred” in the event of Scottish independence, while Scottish-based banks may relocate to England.
The report, What if Scotland Votes for Independence?, said the financial services industry should give the possibility of Scottish independence significant consideration.
It said major banks “might redomicile immediately” to England “under a ‘yes’ vote. Remaining in Scotland could introduce significant, even defining, levels of redenomination, regulatory and legal uncertainty.”
The report added: “While the financial sector would account for a sizeable share of an independent Scotland’s GDP, it would not be markedly different from the UK as a whole.
“However, with both Royal Bank of Scotland and Lloyds technically domiciled in Scotland, their assets alone would be equivalent to more than 1000 per cent of an independent Scotland’s GDP, while their bailouts during the financial crisis would have amounted to around 45 per cent of GDP.
“So an independent Scotland would be relatively heavily exposed to the financial sector. That highlights the potential for corporate relocations across the border in the event of Scottish independence.”
A spokesman for RBS said the group did not have a position, but said: “We have been quite consistent in saying that this is a question which the voters should decide and governments should agree on.”
A spokesman for Lloyds Bank said: “This is a decision for the people of Scotland to make. There continue to be many uncertainties around independence and it would be inappropriate to speculate on what we might or might not do.
“We will have 18 months after the vote to be able to fully assess the specific implications on our business and our customers. In the meantime, our focus is on continuing to serve our customers.”
The BofAML report also said the effect of a ‘yes’ vote on currency was of “most concern” as the Scottish government’s currently stated preferred option was to continue using sterling in a formal currency union with the remaining UK.
So far, all of the main UK political parties have stated that they would not agree to Scotland retaining the currency.
In March, Standard Life – which employs more than 5000 staff in Scotland, and is the third largest PLC based in Scotland after RBS and energy provider SSE – warned that it might transfer away from Scotland in the event of a ‘yes’ vote.
Announcing the provider’s 2013 results, chairman Gerry Grimstone said: “Scotland has been a good place from which to run our business, and we very much hope that this can continue.
“But if anything were to threaten this, we would take whatever action is necessary, including transferring parts of our operations from Scotland, to protect the interests of our stakeholders.”
However, he did not comment further on the implications such a move would have on its majority Scottish-based workforce.
Clayton Manning, an IFA for Advice & Wealth Management in Glasgow said: “If the union did not agree to Scotland having the GBP, then there would be some turmoil ahead.