LONDON (Reuters) - Britain’s smaller companies are hoarding cash and cutting investment, bankers say, a sign of business confidence starting to wobble as the government sets off down the uncertain path of leaving the European Union.

An employee is seen walking over a mosaic of pound sterling symbols set in the floor of the front hall of the Bank of England in London, in this March 25, 2008 file photograph. REUTERS/Luke MacGregor/Files

Companies with revenue of less than 1 million pounds expect to invest an average of 21,690 pounds in their businesses in the next six months – a fall of 74 percent compared with July, Lloyds Banking Group LLOY.L said on Friday following the latest results of its six-monthly survey.

This is the biggest drop since the bank added the question about investment plans in 2015 to its long-running Business in Britain survey of small businesses.

“Businesses need to be careful that in cutting back on investment to boost resilience they don’t put the brakes on too hard,” said Jo Harris, a managing director at Lloyds, one of Britain’s largest business lenders.

Sitting on cash could help companies weather any economic slowdown, but bankers say that reduced spending also threatens to dampen growth prospects for the economy.

The head of commercial lending at another major bank said the last time that he saw smaller companies hoarding money to a similar extent was during the 2008 global financial crisis.

The banker said companies were paying off overdrafts and other loans amid concerns that the economy may suffer after Prime Minister Theresa May seeks to begin the formal process of negotiating a divorce settlement with the EU later this month.

“Customers are nervous ... they are worried that as the news of Brexit negotiations begins to filter through then sentiment will dip,” the banker said.

Lloyds said economic uncertainty was identified as the main threat over the next six months, followed by weaker UK demand and political uncertainty.

Britain’s businesses and banks have largely defied expectations that the economy would suffer an immediate blow from the referendum result in June last year, but in recent weeks there have been signs of mounting concerns as the real Brexit process gets underway.

Aldermore Group ALD.L, a specialist lender to small and medium-sized businesses, said a survey of 1000 such companies conducted in the last financial quarter showed cashflow was their biggest concern.

About a fifth of companies said they missed an opportunity to expand their business because of a lack of available finance, Chief Executive Phillip Monks told Reuters.