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Definition Of Government Broker:


A senior British stockbroker who works for the U.
government.The government broker is authorized to purchase and sell government securities on the London Stock Exchange.S/he operates according to instructions received from the Bank of England and also serves as broker to the National Debt Commissioners.The government broker was senior partner of Mullins & Co. until 1986 when the Bank of England opened its gilt-edged division.Since then, gilt-edged market makers – authorized to deal directly in gilt-edged securities - have, for the most part,assumed the function of the government broker.The establishment of the Bank of England's gilt-edged division concurred with the "Big Bang" in October 1986.The Big Bang created massive market upheaval on the London Stock Exchange by abolishing fixed commission rates for stockbrokers and doing away with exchange rules that established a formal division between brokers and "jobbers" or wholesalers. The London securities market was in large part modernized, and has since become a major force in the globalization of financial markets.

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