The challengers are finding it challenging.

Banking stocks across Europe are experiencing another day of pain today in the wake of the EU membership referendum result but the so-called challenger banks in the UK are under particular pressure, writes Nathalie Thomas.

Shares in Shawbrook, which floated in April last year at a price of 290p-a-share, have plunged 31.1 per cent today to a fresh record low of 160p (see chart above)

Today’s decline follows a 21 per cent drop on Friday when banking, housebuilding, media and retail shares all came under intense pressure when the “leave” camp snatched a surprise victory in the UK’s referendum.

Shawbrook has company on the downward slide, however.

Virgin Money, which floated in 2014 at 283p a share, has also reached a record low. The shares are currently trading at 222.3p, down 19.25 per cent on the day. Since Wendesday last week, the day before the referendum, the shares have lost more than 39 per cent.

Both Shawbrook and Virgin Money are among the biggest fallers on the FTSE All-Share index, along with OneSavings Bank, the lender that emerged from Kent Reliance Building Society and was built up by private equity group JC Flowers before floating two years ago.

Aldermore, another of the challengers, has also fallen a further 14 per cent so far today to 119.9p, following a painful 32 per cent drop on Friday. It, too, is trading at a fresh record low.

Analysts had long cautioned that bank stocks would be among the most vulnerable to a UK exit from the EU, along with housebuilders.

Shares in a number of the UK’s bigger banks – namely Royal Bank of Scotland and Barclays – were temporarily suspended today after they fell more than 8 per cent, triggering a circuit break mechanism.