The British electorate’s decision back in June to exit the EU is likely to prove a significant game-changer for Lloyds’ (LSE: LLOY) investment prospects in the near-term and beyond.

Sure, the effect of mass streamlining following the 2008/09 financial crisis may have reduced the bank’s immediate risk profile. But a subsequent rebalancing towards the British high street now leaves its top line facing an uncertain future as credit demand could dry up, business lending fall and bad loans increase.

Lloyds wasn’t alone in casting off its global assets and doubling-down at home however. Like the ‘Black Horse’ bank, Royal Bank of Scotland (LSE: RBS) has also undertaken massive asset-shedding to rebuild its battered balance sheet and its reputation following the government’s bailout.

Long-term lovelies?

Of course all of Britain’s listed banks will suffer from possible economic cooling in the months and years ahead, not to mention the double-whammy that low interest rates will bring.

But the likes of HSBC (LSE: HSBA) and Santander (LSE: BNC) can at least look to emerging markets to drive future growth — these two institutions source a vast chunk of their revenues from Asia and Latin America respectively.

Don’t get me wrong: these territories aren’t without their own problems, with painful economic rebalancing, soaring inflation, and significant reliance on commodity markets among their problems.

But growth rates in Asia far exceed those of the West, much to the cheer of HSBC, with the IMF expecting Chinese GDP to expand 6.2% next year versus a predicted 1.1% rise in Britain.

An estimated 0.5% rise in Brazil illustrates the current political and financial malaise there, and with it the prospect of further revenues troubles at Santander. However, I remain positive about the bank’s long-term outlook as rampant population growth and the rise of the middle class in such developing regions should boost demand for banking products.

Passporting perils

Barclays’ (LSE: BARC) decision to sell its stake in Barclays Africa Group, and focus on its operations in the US and UK, reduces its own exposure to these fast-growing regions, of course. However, all is all not lost as the bank’s Barclaycard credit card division is still pulling up trees across the globe.

And unlike Lloyds, Barclays can look to its customers on the other side of the Atlantic to drive revenues should the British economy hit severe turbulence.

Having said that, looking towards foreign climes to generate growth may not be as straightforward as it once was. In particular, Britain’s EU withdrawal could wreak havoc on the banking sector’s top line should the right to sell products across the EU bloc be withdrawn.

Bundesbank chief Jens Weidmann commented last month that “passporting rights are tied to the single market and would automatically cease to apply if Great Britain is no longer at least part of the European Economic Area,” adding a further leg of uncertainty for the post-Brexit landscape.

Given the prospect of extended revenues turmoil at home and abroad, not to mention the steady build in misconduct-related costs, I reckon investment in the banking sector is far too risky at the present time.

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Royston Wild has no position in any shares mentioned. The Motley Fool UK has recommended Barclays and HSBC Holdings. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.