Investors should avoid all banks, but particularly those reliant on Britain. This includes Lloyds Banking Group (which owns Lloyds, Halifax and Bank of Scotland) and NatWest, which owns Royal Bank of Scotland.
Companies with large pension deficits such as BT, supermarket chain Tesco and defence firm BAE, should also be avoided.
The cost of providing a guaranteed pension is based on the yield on government bonds, which would fall if the Bank Rate went negative. The lower the yield, the higher the cost. Companies would have to put more money into their pension schemes, taking capital away from other areas.
Negative rates were once a far-fetched idea, but Japan and the eurozone have turned to them in desperate times. They impact more than investments as well, as we discuss here, and it is something Britons should be ready for.