ICAP's currency trading volumes fall despite Brexit surge

* Q1 EBS average daily volumes fall 15 pct to $83 bln

* Q1 revenue from continuing ops up 7 pct

* Gained a "significant windfall" from Brexit stg fall (Recasts, adds CEO comments from media call, details)

By Noor Zainab Hussain

July 13 (Reuters) - Interdealer broker ICAP (LSE: IAP.L - news) reported a 15 percent slump in first-quarter average daily volume on its foreign exchange trading platform EBS, despite a trading surge after Britain's vote to leave the European Union sent sterling plunging.

The company, soon to be named NEX Group after the sale of its telephone broking business to rival Tullett Prebon (LSE: TLPR.L - news) , said daily volumes roughly doubled to top $200 billion on its currency trading platform the day after the June 23 vote.

Sterling has fallen to its lowest level against the U.S (Other OTC: UBGXF - news) . dollar since 1985.

ICAP, which matches buyers and sellers of bonds, swaps and currencies, said revenue from continuing operations for the quarter to June 30 rose 7 percent.

However, average daily volume on EBS, the main venue for banks and other institutions to trade the euro, yen and Swiss franc against the dollar, fell to $83 billion in the quarter, due to lower volatility.

"Certainly the extension of the ultra-low interest rate environment is not helpful. We were hopeful that U.S. rates would continue to move upwards this year. It (Other OTC: ITGL - news) now looks like that will quite likely not happen," said ICAP Chief Executive Michael Spencer on a conference call.

The company has been seeking new clients and markets to counter falling volumes.

It has won a contract to provide technology for China's main fixed income and foreign exchange trading system, giving the British broker a major break in the world's second-largest economy.

The broker said in a statement on Wednesday it remains "cautiously confident" for the rest of the year despite an increasingly uncertain macroeconomic outlook for the UK and global economy.

However, Spencer remained optimistic on the fate of sterling backed assets after Brexit, pointing to a property portfolio on Oxford Street sold to an overseas investor.

Property company British Land (LSE: BLND.L - news) said last week it had exchanged contracts to sell a Debenhams (Other OTC: DBHSF - news) store, a seven storey building on Oxford Street for 400 million pounds ($531.60 million), a sign that deals were still being agreed despite concerns around the impact of Brexit.

"I think what the central bank, the governor of the Bank of England has done has been very foresightful, very thoughtful and very appropriate and I think as a result of this we will not see capital flight out of the UK," said Spencer, who voted to stay in the EU.

"Quite possibly we might see capital flow now that UK assets are more than 10 percent cheaper than they were a month ago."

ICAP said that as a global business it would not have to move any of its operations out of London.

"We've got 60 odd offices around the world, of which, funnily enough only one is in the UK," Spencer said. "We were candidly struggling to think any of the services that we offer out of London today that we would need to redomicile to continue."

Shares (Berlin: DI6.BE - news) in ICAP were unchanged at 452.4 pence at 1117 GMT. ($1 = 0.7524 pounds) (Reporting by Noor Zainab Hussain in Bengaluru, editing by Rachel Armstrong and Louise Heavens)