(Bloomberg) -- Banks' demand for cash fell in the Bank of England's second liquidity operation since the U.K. voted to leave the European Union, sparking financial market turmoil.
At the auction of funds in exchange for collateral, 12 days after Britain voted for a so-called Brexit, banks were allotted 1.35 billion pounds ($1.8 billion). That compared with 3.1 billion pounds a week ago. The allotment matches the banks' bids.
BOE Governor Mark Carney has increased the number of funding operations to avoid markets seizing up after investors were rattled by Britons' shock 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.
To contact the reporter on this story: Scott Hamilton in London at shamilton8@bloomberg.net. To contact the editors responsible for this story: Paul Gordon at pgordon6@bloomberg.net, Zoe Schneeweiss, Lucy Meakin
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