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* Banks draft in traders for British EU referendum night
* One fund prepares for 30 pct sterling fall if "Out" wins
* Bank of England to staff through the night
By William James, Freya Berry and Patrick Graham
LONDON, June 15 (Reuters) - The world's biggest banksincluding Citi and Goldman Sachs will draft in senior traders towork through the night following Britain's referendum on EUmembership, set to be among the most volatile 24 hours formarkets in a quarter of a century.
A vote to leave the European Union on June 23 would spookinvestors by undermining post-World War Two attempts at Europeanintegration and placing a question mark over the future of theUnited Kingdom and its $2.9 trillion economy.
Citi, Deutsche Bank, JPMorgan,Goldman Sachs, HSBC, Barclays, RoyalBank of Scotland and Lloyds are among thosebanks planning to have senior staff and traders working or oncall in London as results start to dribble in after polls closeat 2100 GMT, according to the sources.
Jamie Dimon, chief executive officer of JPMorgan Chase & Co,told employees on a visit to Britain this month that if the votewas to leave the EU, the bank would have to have "teams ofpeople thrown on what that means".
"We won't know what it means: there is a wide range ofoutcomes," Dimon, a supporter of Britain's membership who haswarned of job cuts at JPMorgan in Britain if there is an Outvote, said in the broadcast speech.
A vote to leave could unleash turmoil on foreign exchange,equity and bond markets, spoiling bets across asset classes andpotentially testing the infrastructure of Western markets suchas computer systems, stock exchanges and clearing houses.
Federal Reserve Chair Janet Yellen has cautioned that aBrexit vote could shake financial markets and potentially pushback the timing of the next rise in U.S. interest rates.
Bank of England Governor Mark Carney has said sterling coulddepreciate, "perhaps sharply" and some major banks have forecastan unprecedented fall to parity with the euro and as low as$1.20 in the days following any vote to leave the bloc.
The Bank of England will be staffed overnight, with seniorpolicymakers on call if markets go into meltdown. The financeministry would not comment on its staffing plans.
The official Vote Leave campaign argues there is no evidencethat leaving the EU would weaken sterling long term, while NigelFarage, leader of the UK Independence Party has said that evenif the currency did fall, it would simply boost British exports.
BREXIT NIGHT?
Sterling - the world's fourth most traded currency - hasmoved sharply in recent weeks, often on the back of opinionpolls.
Depending on the results from across the United Kingdom, thenight of June 23 and early morning of June 24 could rank as oneof the most volatile nights in the history of the London market.
"We've all seen U.S. elections, UK general elections, we'vehad the Scottish referendum, the collapse of Lehman and QE(Quantitative Easing) but this is by far and away the biggestrisk event that has presented itself to the UK," said ChrisHuddleston, head of money markets at specialist bank Investec.
London accounts for 41 percent of global turnover in the$5.3 trillion-a-day foreign exchange market, more than doublethe turnover in the United States and far more than the 3percent of its closest EU competitors, France and Switzerland.
"All the traders are going to be in ... They don't likemissing big moments, if there's going to be one, they want to beat their desk," said a senior source at a major bank based inthe Canary Wharf financial district of London.
Some banks are planning the night down to the smallestdetail to keep their traders on top form - laying on all nightcatering and booking nearby hotels to offer temporary respite.
"It is the biggest planned risk event that anyone canremember, so everyone is going to be involved. The question isjust when you try and get some sleep," said one senior foreignexchange trader.
No exit polls are planned by British broadcasters so thefirst numbers from the counts will be turnout results from 382different areas followed by totals for 'Remain' and 'Leave' ineach area.
STERLING
Polls have given contradictory pictures of British publicopinion, keeping markets guessing on the final outcome.
That has left sterling, currently priced at $1.41, far awayfrom either of its likely resting places after the final resultis known - seen by banks as around $1.50 in the event of aremain vote, or $1.30 or lower if Britain votes to leave.
That almost-certain rapid repricing could set the scene forone of the rockiest sessions since traders wrestled down thevalue of sterling on Black Wednesday, September 16, 1992, whenBritain crashed out of the European Exchange Rate Mechanism.
"If it's Brexit, then we're looking at something that's atleast on the scale of Black Wednesday," said Nick Parsons,global co-head of FX strategy at National Australia Bank and aveteran of the 1992 sterling crisis.
Prices for derivatives used to mitigate the risk of sharpswings in sterling point to a period of intense volatility.
Officials and bank managers planning for the event drawcomparisons with the 40 percent surge in the Swiss franc inJanuary 2015, which bankrupted dozens of small investment fundsand cost banks including Citi hundreds of millions of dollars.
Traders and analysts told Reuters they would expect a Brexitvote to cause sterling to 'gap', or plummet lower - as orders tosell the currency met an absence of willing buyers, leaving ablank spot on the price charts snaking across traders' screens.
Gaps can inflict huge losses on banks and traders, forcingthem to bail out of trades at prices far below the automaticsell orders, or 'stops' they normally use to limit losses.
Currency market participants have urged the Bank of Englandto call on U.S. Federal Reserve if the turbulence gets reallybad. The BoE could buy sterling with dollars borrowed directlyfrom the U.S. central bank under arrangements first used inresponse to the global financial crisis in 2008.
Carney has said the Bank would not stand in the way of anyexchange rate adjustment but would take the necessary steps toensure markets remained orderly. It has not commented on whetheror how the bank might intervene.
"MONEY TO BE MADE"
A senior source at one London bank said his firm had beenbuilding big reserves of sterling to lend out to any clients whoget caught short by swirling asset valuations that require themto post extra security deposits with their trading partners.
Foreign exchange brokers such as PhillipCapital UK and SaxoBank have raised the security deposit they demand from clientsin order to trade, a step designed to offset the increased riskthat customers get caught out by sharp moves.
One asset manager who declined to be named said his firm hadrun a test to see if it could cope with a 30 percent fall insterling. The fund had increased its cash holdings and wouldhave traders working overnight, ready to sell other assets incase it needed to raise more cash in a hurry.
Volatile markets not only put traders under pressure: theytest the limits of the technology that underpin the market.
A source at the London Stock Exchange said volatility couldspike on June 24 and that it was putting in emergency capacityfor transaction reporting to cope with any spike in tradingvolumes that might otherwise overwhelm its systems.
A spokesperson for LSE declined to comment.
Despite facing a battle against surges in trading volumes,volatile prices and, at times, the absence of enough buyers orsellers to meet demand, some traders are rubbing their hands atthe prospect of a night and day of high drama.
"You look forward to days like this," said one bond traderat a major London bank. "There's money to be made and lost ...You've just got to hope you're on the right side of it, not theone being carried out the door."
(Additional reporting by Jamie McGeever, Anirban Nag, JohnGeddie, Dhara Ranasinghe, William Schomberg, Anjuli Davies,Andrew Macaskill, Lawrence White, Simon Jessop, Marc Jones andMaiya Keidan, Editing by Guy Faulconbridge and PhilippaFletcher)
