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Brexit? You will be Fine… Unless You Are British!

22 February 2016 by lberuti

If some investors came in the office this morning all beared up following Boris’ announcement that he will campaign in favour of the “Brexit”, they must have been left bitterly disappointed. The most notable move was in FX, with GPB losing 1.8% against the USD, but in creditland, the reaction was sanguine to say the least. There was not a single credit index which closed wider on the day. The same was not true regarding single reference CDS though, as a few constituents of iTraxx Main were wider. And yes, the vast majority were UK names, and most of them were banks. The poor results released by HSBC (HSBC Holdings Plc) this morning probably did not help - they missed on pretty much everything and raised questions on their energy lending book -, but UK banks are obviously the ones which stand to lose the most if the UK decided to go its own separate way.