A strong majority of investment banking professionals fear a Leave vote would have dire consequences for business.
A survey of almost 1,500 M&A professionals published by technology provider Intralinks found that 67% of respondents felt that a UK vote to leave the European Union would negatively impact M&A levels across Europe, and 76% said it would negatively impact the economy.
Philip Whitchelo, the vice-president of product marketing and strategy at Intralinks, said: “There’s clearly a consensus among dealmakers that a Brexit will lead to chaos for European M&A.”
John St John, the founder of advisory boutique STJ Advisors, said “if it [Brexit] did happen it would worry me immensely”.
St John added: “It appears that there are a bunch of floating voters who have swung behind the Brexit camp and people in the last two or three days have become more nervous.
“The downside of an exit is far greater than people imagine, particularly in the short term. Very rarely do you have such consistency across all leading economists that Brexit would be bad for our economy. Before joining the EEC we were ‘the sick man of Europe’. Post being in Europe we have consistently outperformed and have enjoyed a pretty much unbroken period of peace and prosperity.”
In markets, a fixed income currencies and commodities director at a large UK bank added that Brexit would be “the straw that broke the camel’s back” for his business. The banker also said the volume of foreign exchange options trading on the pound was low, because very few counterparties were willing to take the other side of sterling transactions.
Meanwhile, equity capital markets bankers are bracing for a busy few weeks in the event of a Remain vote. When asked if staff at his bank would be expected not to go on holiday in the weeks following the vote, one UK ECM head said simply: “We are on high alert for a flurry of issuance in the event of a Remain vote, yes.”
Additional reporting by Bernard Goyder