EXPORTERS and financial services firms can “ill afford” the risks associated with leaving the EU, a leading insolvency firm has claimed.

Begbies Traynor’s regular Red Flag Alert research found the number of Bournemouth’s financial services companies in “significant” financial distress was up 23 per cent year-on-year.

It said there were 21 such businesses struggling in the first quarter of 2016 locally compared with 17 last year.

The number of Bournemouth manufacturers in significant financial distress stayed broadly flaw – 59 compared with 60 last year.

Across the South West, there were 22,520 businesses in significant distress – up 18 per cent from 19,026 last year.

The research suggested the financial services sector – which is exposed to the European financial markets and investment community – was in a “substantially weaker” position than a year ago.

Julie Palmer, partner at Begbies Traynor’s Bournemouth office, said: “Our data shows the UK’s exporting industries are already under significant financial pressure and can ill afford any potential risk to the 50 per cent of British exports that go into the EU.

“The Red Flag manufacturing figures show that the threat of uncertainty surrounding the referendum has already put the brakes on this segment of the economy, which should be accelerating with the benefit of recent Sterling weakness, with many UK firms adopting a ‘wait and see’ approach to any change to the UK’s relationship with the EU."

She said it was important for businesses to make plans for both outcomes in the referendum.

Major local manufacturers in the ‘remain’ camp include cosmetics brand Lush, which has warned it might have to move parts of its Poole business abroad following a Brexit vote; global technology firm Siemens, which employs around 500 people in Poole; and Poole-based luxury boat maker Sunseeker, which employs around 2,000 people.

In financial services, JP Morgan and Barclays – which employ 4,000 people in Bournemouth and 900 in Poole respectively – are both backing a ‘remain’ vote.

Campaigners for Brexit include bosses at Christchurch-based Reidsteel, whose director Simon Boyd chairs Business for Britain South West. He has said leaving the EU would make it easier for British businesses to export and make them stronger in the UK.