Jefferies Says Brexit May Threaten Trading Revenue in Europe

  • Investment bank sees volatility, damage to investor confidence
  • Finance business posts losses for periods ended in May

Jefferies Group, the investment bank owned by Leucadia National Corp., said the U.K.’s vote to leave the European Union may hurt its business on the Continent.

“The uncertainty surrounding the terms of the U.K.’s exit and its consequences could adversely impact customer and investor confidence, result in additional market volatility and adversely affect our businesses, including our revenues from trading and investment banking activities, particularly in Europe,” New York-based Jefferies said Friday in a quarterly regulatory filing.

Separately, Jefferies said its joint-venture business that helps fund corporate deals posted net losses of $33.2 million for the fiscal quarter ended May 31 and $77.8 million for the six-month period ended May 31, according to the filing. That’s the first loss in those periods since at least 2011, filings show.

Jefferies reorganized the business in March, elevating an investment banker to oversee leveraged finance origination while a senior executive left, people with knowledge of the matter said at the time. The firm created Jefferies Finance as a joint venture in 2004 with Babson Capital Management LLC and Massachusetts Mutual Life Insurance Co. to originate debt and syndicate it to investors.

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