HSBC has become the latest banking giant to make provisions in anticipation of bad loans spiking in the UK because of Brexit.

Unveiling its results for 2018, which revealed profits came in behind analysts’ expectations, the bank declared that it has set aside an additional $165 million (£126m) to account for extra credit losses linked to the uncertainties facing the UK economy.

The move comes shortly after stated-backed Royal Bank of Scotland made a £100m provision in October to account for bad debts rising due to Brexit.

It underlines the degree of nervousness at the top of UK business over the lack of progress made by Theresa May’s Conservative Government in finalising the terms of the country’s exit from the European Union (EU). With just 37 days to go until the UK’s scheduled departure date, the inability of Parliament to ratify a withdrawal agreement has heightened fears the country will crash out of the bloc without a deal.

READ MORE: Royal Bank chiefs dismayed over Brexit disorder

Speaking in a results presentation to analysts, HSBC chief executive John Flint said: “The outlook for 2019 has softened. Uncertainty and risk in the global economy is higher, relating mainly to the UK economy, global trade tensions, and the future path of interest rates. This is yet to translate into higher credit losses, but that could change if the global economy deteriorates further.”

Royal Bank of Scotland highlighted its concern over Brexit when it reported its results on Friday. Ross McEwan, the bank’s chief executive, expressed frustration over the continuing political impasse, declaring that the uncertainty has already led to UK economic growth “cooling off”. Mr McEwan said: “I don’t think I’m alone in saying that the political uncertainty has gone on far too long. Our corporate clients are pausing before making financial decisions, and this of course is damaging the UK economy and will affect our income performance.”

READ MORE: Royal Bank shares hit by £100m Brexit charge

Mr Flint at HSBC expressed a similar sentiment yesterday, telling analysts: “What we are seeing is that risk and uncertainty have increased, and customers are more cautious. We remain alive and alert to these risks. Where necessary, we are proactively managing costs and investments in line with the softer outlook and will continue to so.

“What we absolutely will not do, though, is take short-term decisions that harm the long-term interests of this organisation. We will continue to invest sensibly and sustainably.”

Mr Flint noted that 2018 had seen the bank set up a ring-fenced bank, grown its customer base and increased its market share in the UK. Like Royal Bank, which is moving to set up subsidiaries in Amsterdam and Frankfurt, HSBC said it was continuing to make preparations for Brexit to provide continuity for customers in the UK and mainland Europe.

“Our well-established universal bank in France gives us a major advantage in this regard,” Mr Flint added. “Our immediate priority is to help our customers manage the present uncertainty.”

READ MORE: Royal Bank issues Brexit warning as profits double

The bank reported that profits before tax had grown by 16 per cent to $19.9 billion, amid a “softer” conditions in the fourth quarter, missing analysts’ forecasts of $21.3bn.

HSBC, which has 10 branches in Scotland, said reported revenue was 5% higher at $53.8 billion, driven by a rise in deposit revenue across its global businesses, primarily in Asia, where it makes the bulk of its profits.

But chairman Mark Tucker highlighted the risks associated with continuing global trade tensions, including the ongoing stand-off between the US and China.

He said: “The system of global trade remains subject to political pressure, and differences between China and the US will likely continue to inform sentiment in 2019. However, the conclusion of major trade agreements ... provide important counterweights that could give impetus to international trade in the year ahead.”

Shares in HSBC ended the day down 4%, or 26.6p, at 637.1p.