The daily Globe and Mail, citing an anonymous source, said the banks which are some of the biggest users of the Toronto Stock Exchange would voice their concerns about the deal in an open letter this week.

"Toronto's hopes to be a global financial services hub could suffer a severe and potentially irreversible setback," a draft of the letter is said to read.

"Proponents of the proposed LSE takeover of the TMX believe this transaction represents Canada's only choice to create a globally sustainable exchange. They are wrong. The TMX is already a viable global entity."

Each of the signatories is said to have "degrees of opposition" to the deal, with one expected to take a hard line against the merger while another could support it with conditions.

They include the Toronto-Dominion Bank, Bank of Nova Scotia, Canadian Imperial Bank of Commerce and National Bank of Canada.

The merger would create the world's biggest trading platform that would dominate the raw materials and energy sectors, spanning 20 trading markets and platforms across Europe and North America.

The group, provisionally called LSEG-TMX, would also be the world's largest exchange in terms of the number of companies traded, with a total of more than 6,700 listings.

The deal is expected to be completed in the second half of this year, subject to shareholder and regulatory approvals.