U.S Banks Tell Trading Clients To Brace Up For Britain EU Exit

U.S. banks including Bank of America Corp  and Morgan Stanley  are warning clients about the potential for extreme price moves as Britain prepares to vote on its membership of the European Union (EU).

A vote to leave the EU in Thursday’s referendum could unleash turmoil on foreign exchange, equity and bond markets, causing trading volumes to spike and testing the ability of banks’ systems to process trades.

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Bank of America warned its clients, in a June 20 memo reviewed by Reuters, of possible delays to their trades and temporary suspensions if markets are very volatile.

“During volatile markets, we will endeavor to continue to serve clients but we may not be able to provide the product offering, level of execution, liquidity and pricing – including in electronic markets – as would be the case under more normalized market conditions,” the memo said.

Morgan Stanley, in a June 20 memo reviewed by Reuters, also told clients it would staff its U.S. trading desks earlier than usual on the Friday morning after the vote to provide increased coverage for clients who had previously traded premarket.

In order to prepare for any volatility, it requested that clients tell them about proposed changes to their limits for cash and derivatives by the start of the trading day on Wednesday.


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Daniel Enisan is a content writer at edliner.com. With a degree in mass communication, Daniel is a full breed journalist. Daniel is a realist, loves the use of sarcasm, a movie and music junkie. He is also a poet and a good listener.

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