The U.K. could lose up to half of its investment banking jobs over the next few years if the government continues to pursue a hard-line exit from the EU, a new report has warned.

As many as 40,000 sales and trading and investment banking roles could move from the City of London to other European finance hubs as banks scramble to maintain access to the European single market once Britain leaves the bloc in 2019, according to estimates from consultancy Oliver Wyman.

Already a number of banks, including Citigroup, UBS and Barclays, have announced plans to relocate thousands of jobs to new subsidiaries across the EU. Financial services firms were given until July 14 to present the Bank of England with their contingency plans.

Initially these moves are expected to take between 12,000 and 17,000 wholesale banking jobs out of the U.K. capital. However, this number could rise to 40,000 over the longer-term as wholesale banks face uncertainty over clearing and seek to improve collaboration between staff.

“Banks have been working hard to design ‘Day 1’ operating models to ensure continuity of client service in the event of a hard Brexit. Although some banks may take the opportunity to restructure their European footprint more broadly, most are looking to minimize expense and disruption by relocating as little as possible in the first instance,” the report released Tuesday noted.

Over the medium term, however, pressures are likely to grow for banks to move beyond their initial ‘Day 1’ operating models,” it added. “These pressures are likely to lead wholesale banks to increase their presence inside the EU over time.”

The wholesale banking industry, which includes sales, trading and investment banking, accounts for 80,000 jobs in the U.K., according to Oliver Wyman estimates. The consultancy separately estimates that the wider financial services industry, including insurers and retail banks, will lose 31,000 to 35,000 jobs over the medium term.

The impact of such job losses would be striking, not just for the industry but the U.K. economy as a whole. The financial services industry is one of the largest contributors to U.K. gross domestic product (GDP), accounting for 22 percent of London’s GDP alone.

British Prime Minister Theresa May has been pushing for a so-called ‘hard Brexit‘, which would remove the U.K. from the single market and end the free movement of people. Finance minister Philip Hammond has proposed a ‘transition period’ of up to three years to help businesses navigate the new framework once Britain leaves the union.

However, the report insists that the financial services industry will not be able to wait until then to gain clarity.

“The U.K. government has signalled a clear commitment to a transition period. Yet the agreed timetable for Brexit negotiations will initially prioritize the divorce bill, the Irish border, and the status of expats. Until an implementation period is formally agreed with the EU, banks will not be able to rely on this in their planning.”

The report comes as German lender Deutsche Bank exchanged a pre-let agreement for its new City of London headquarters Tuesday. Discussions over the 25-year lease were seen as a vote of confidence in the City of London, however, the bank has since indicated that it will also move thousands of jobs to Frankfurt as part of a shift of its securities trading business.

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