If Scotland chooses to be an independent country its currency options and banking regime choices will be difficult, and none of them particularly credible, Societe Generale warns.

There are no appealing currency options for an independent Scotland if voters decide to leave the United Kingdom, ending over 300 years of union with England, the private bank of France’s Societe Generale says.

The economic stakes around any “yes” vote for independence have been brightly highlighted by announcements this week from three of the UK’s largest financial firms (Lloyds, Royal Bank of Scotland and Standard Life) that they will switch headquarters and major operations south if Scotland takes this course.

A particularly vexed issue, as highlighted by the travails of the eurozone (as in the Greek situation) is whether one can have currency union without a high degree of political union. Alex Salmond, Scotland’s First Minister and leader of the Scottish National Party, has claimed Scotland will be able to continue using sterling post-independence, but his views are challenged by other mainstream parties and the governor of the Bank of England, Mark Carney.

Alan Mudie, head of investment strategy for Societe Generale Private Banking, cast doubt on the currency options that Scotland has when he spoke to this publication recently. He said there are four options: continued use of sterling but no control over rates, debt or use of a central bank; currency and banking union; a new Scottish currency, and membership of the euro.

On the monetary/banking union option, this has been explicitly rejected by the Conservative, Liberal Democrat and Labour Parties in the UK, Mudie said. He said the eurozone experience of currency union without full political union should be a chastening one.

On what is called “sterlingisation” – using the pound but without controls over debt, rates or the central bank, this would be a temporary situation as Scotland would not have control over the levers of policy and it would be hard to reconcile with the supposed point of independence, which is running one’s own affairs. Some people have drawn parallels with such arrangements used by jurisdictions such as Panama. These are unwise since Scotland, relative to the rest of the UK, is bigger than Panama relative to the US.

An adopting the euro, Mudie was blunt:“This is a non-starter; Scotland would not automatically be able to enter the EU.” A condition of rejoining the EU would be euro adoption after a certain period of time and to do that Scotland needs to meet the Maastricht debt and deficit criteria; however, Scotland is some way off doing that.”

Mudie said the idea of a new, Scottish currency is is the most consistent option from the point of view of being an independent country. “The country will need a central bank able to act as a lender of last resort.

However, it is the most complex solution for a country of Scotland’s size, making it difficult to set up quickly,” he said.

“An option might be to adopt some sort of sterling peg/currency board arrangement for a transitional period, but this also requires the country concerned to adopt strict policy rules, which might be difficult,” he said.

Asked about broader issues from the vote, Mudie said if people vote against independence but the result is close, this will leave a period of continued volatility. A “yes” vote will see further downward pressure on the pound and UK gilts; such falls in sterling – and possible negative effect on other assets – might, however, encourage foreign buyers of assets, he said.

Mudie joined Societe Generale Private Banking in May 2014 from UBP in Switzerland, where he had been CIO of Private Banking since 2011, following a period at Syz & Co, initially as CEO of Oyster Funds and then as Head of the Fund Research department. He has also worked at BNP Paribas and Crédit Agricole and Barclays Bank.