IF there was any lingering doubt over the effect Brexit uncertainty is having on major UK banking stocks, it was surely blown out of the water yesterday.

Shares in CYBG, owner of Clydesdale Bank, plunged by nearly 17 per cent as investors responded to the grim outlook for the UK painted by chief executive David Duffy, who warned the political and economic environment was “inherently uncertain” thanks to the lack of clarity on the Brexit talks.

It came just days after the share prices of both Royal Bank of Scotland and Lloyds Banking Group slumped amid the flurry of resignations and political rancour which emerged as Theresa May secured Cabinet support for her EU withdrawal agreement.

But Brexit was not the only the fly in the ointment for CYBG shares when the bank reported its preliminary results yesterday.

That the share price dropped so precipitously will be at least partly down to the further provision for payment protection insurance (PPI) claims made by the bank. The £150 million charge looks to have blind-sided investors who had perhaps anticipated that the worst of the scandal was over. It overshadowed the board’s commitment to increase its dividend to 3.1p per share, up from the inaugural dividend of 1p per share CYBG paid last year.

These are undoubtedly challenging times for banks such as CYBG which, because of their exposure to the UK economy, are seeing customer confidence being tested to the full because of Brexit.

In that respect, its merger with Virgin Money has perhaps come along in the nick of time.