Is UK banking ready for Scottish independence?
With monetary union off the table, a national break-up could make Brexit seem like a skirmish.
If the Scottish National Party (SNP) wins a majority in the Scottish parliament elections this May, it will push for a second independence referendum by 2024, according to draft legislation.
This is no small risk for UK banks and their investors – despite recent fighting inside the nationalist cause between first minister Nicola Sturgeon and her predecessor Alex Salmond.
Support for Scottish independence has been gradually rising during the past five years, due to Sturgeon’s high popularity and instability in Westminster, especially over Brexit.
As Scotland voted to remain in the European Union in 2016, Sturgeon has used Brexit to argue for another referendum on independence, Salmond having lost the last one in 2014.
But Scottish independence could cause even more chaos than Brexit, because the EU is not a state and the UK was never in the eurozone.
Frustratingly, Brexit makes Scottish independence harder, because the EU can no longer provide a common umbrella for trade, even if Scotland were to re-join. Scotland is much more reliant on trade with England than the UK is with the EU. It also shares much more administration with the rest of the UK than the UK did with the EU.