UBS Warns of Potential Trading Hiccups Surrounding 'Brexit' Vote

ZURICH—UBS Group AG issued a warning Tuesday that the Swiss bank may have difficulty accommodating trading in the run-up to, and in the wake of, this week's U.K. vote on European Union membership.

UBS said in an emailed notification that while it's difficult to predict market conditions just before Thursday's vote and immediately after results are expected the following day, "we may see an increase in volatility and an impact on trading volumes." That could lead to a situation where prices become "non-tradable" for certain periods, the bank said.

Automated foreign exchange trades won't execute while prices are non-tradable, UBS said. It added that in the event of "extreme market moves" UBS might not be able to fill so-called limit orders, which are placed to buy or sell at set prices, or to fill orders to close out positions once prices vary to specified degrees, in ways "expected in normally functioning markets."

"UBS may adopt other approaches as it deems appropriate and feasible under the given circumstances," the bank said. "Any determinations we make will be made in good faith and in a commercially reasonable manner."

A UBS spokesman declined to comment.

The U.K. referendum on whether or not to leave the EU has already moved markets in equities, debt and currencies, based on shifting poll data. However, the most significant moves by investors are expected after the vote results are announced.

Write to John Letzing at [e-mail]

(END) Dow Jones Newswires

June 21, 2016 13:45 ET (17:45 GMT)

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