A Brexit would hammer investment in the U.K and Europe for years, JPMorgan's corporate and investment bank boss told CNBC, as he echoed warnings that the bank would need to move thousands of jobs to Europe if the U.K. left the European Union (EU).
Daniel Pinto, JPMorgan's chief executive for corporate and investment bank, said that even if there were long-term benefits to a Brexit - benefits that he said were currently difficult to envisage - the uncertainty it created "would have substantial economic impact for a number of years."
"For a number of years, the decision of Brexit will create so much uncertainty that it will hurt real investment in the U.K. and Europe," he said.
Global markets are on edge in the build-up to the June 23 referendum in which British citizens will vote on whether to remain within or leave the EU. Recent opinion polls have swung toward the leave camp, which gained momentum on Monday when the influential The Sun newspaper endorsed a Brexit.
Like many banks, JPMorgan has its European headquarters in the financial hub of London and a Brexit would raise uncertainty over its relationships with clients in Europe.
Speaking to CNBC on the sidelines of a JPMorgan conference in Beijing, Pinto said the worst case scenario would be if the bank could not offer services to European clients from London, which would force it to duplicate its U.K. infrastructure in Europe.
"The issue with that is very simple...We have a very efficient model today," he said."By splitting it, we are going to have a less efficient model because it will be more costly to run two entities instead of one and for sure, we will [probably have] to move several thousands of jobs from one place to another."
His comments echoed a warning made by JPMorgan's chairman and chief executive Jamie Dimon, who reportedly warned the bank's U.K. staff this month that a Brexit would force the bank to move jobs from the U.K. to Europe. According to Reuters, the bank employs 16,000 people in Britain. JPMorgan is one of a number of banks that have donated to the remain campaign.
Pinto cautioned, however, that it was too soon to measure the size of the fallout because the U.K. would have two to three years to negotiate its exit, with the nature of the Brexit deal being key.
What was clear, the banker added, was that "it's very difficult to see the benefit in the long term, but it's very easy to see how tough it's going to be for a number of years after the decision."
Fed meeting
Pinto also said that the U.S. Federal Reserve was expected to stand pat at this week's meeting given uncertainty over the Brexit referendum.
This is despite the Fed's desire to increase interest rates, an exercise that it is finding difficult to execute.
"The Fed would want to hike several times so when slowdown in the economy takes place, they have some ammunition," Pinto said.
The Fed's conundrum comes amid negative interest rates in the euro zone. and Japan, policies that Pinto said the U.S. was unlikely to adopt.
"It hasn't been proven that negative interest rates produce effects that central banks are trying to achieve ... If you have money deposited, you don't get anything in return, you feel you have less money, you feel you have no inflation, so really there is no reason for you to consume anything (and) that creates a negative momentum," said Pinto.
Correction:
The article has been updated to reflect Pinto's responsibilities as well as his worst-case scenario.