• BOE allots 2.005 billion pounds in indexed long-term repo op
  • Third liquidity operation since Britain’s Brexit vote

Banks’ demand for cash increased in the Bank of England’s third liquidity operation since the U.K. vote to leave the European Union sparked financial market turmoil.

At the auction of funds in exchange for collateral, 19 days after Britain opted for a so-called Brexit, banks were allotted 2.005 billion pounds ($2.7 billion). That compared with 3.1 billion pounds at a sale in the days following the vote and 1.35 billion pounds last week. The allotment matches the banks’ bids.

BOE Governor Mark Carney increased the number of funding operations to avoid markets seizing up as investors assessed Britons’ vote to leave the EU at the June 23 referendum. Carney has said officials are ready to pump 250 billion pounds of cash into the financial system, with the central bank now conducting weekly liquidity auctions through to the end of September rather than on a monthly basis.

Banks’ total uptake at the BOE’s four June ILTR operations was 9.2 billion pounds. The average for the six-month operations between December 2015 and May 2016 was 3 billion pounds.

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