Bermuda's two main banks saw many of their operations halted yesterday by the terrorist blasts which rocked the markets around the world and stopped foreign exchange activity.

The Bank of Bermuda said all banking activity had been suspended bar Bermuda dollar trades in Bermuda.

It added that all foreign exchange activity had been suspended in all currencies.

The Bank of NT Butterfield & Son said it was continuing to conduct local business as usual but all payments to and through the US were suspended.

Both banks remained open as did the Bermuda Stock Exchange, which said that while the banks and the Government remained opened for business, so would the Exchange.

Calum Johnston, president & chief executive officer of the Bank of Butterfield said: "We are aware of the major tragedies that have affected the United States this morning."

He added: "Our thoughts and prayers are with those who may be impacted by this in any way.

"Bank of Butterfield is continuing to conduct local business as usual but payments made to and through the United States have been suspended while we await further news of the full effects of the events."

For some time there were reports that some machines were not accepting direct debit cards during the afternoon, but Bank of Bermuda said that their Easylink cards had not been affected and Bank of Butterfield said all Island card and local credit card transactions were unaffected.

However Bank of Butterfield said it had experienced disruption with MasterCard debit card processing yesterday morning which appears not to be related to the disaster.

A statement from the bank said: "This is related to a communications problem that has occurred with our processor in the United States."

The statement continued: "We have been in contact with them throughout the day to correct the problem and they are working closely with our engineers in order to restore the facility to normal. We have no indication from the processor that the problem is related to the unfortunate events which occurred in the United States."

The bank added that there was no impact on US credit card processing, but debit cards being presented to Bank of Butterfield merchants would be impacted by the outage of communications link with its processor.

Bank of Bermuda said it had restocked its ATM machines with cash to help the influx of unexpected visitors and said if anyone experiences problems with the machines it may be the pin number that has a problem, and to physically go into branches to get cash that way for either debit or credit cards.

Bermuda's biggest bank said incoming funds will be credited as and when they are able to confirm payment has been received and the Bank of Butterfield said local customers expecting wire transfers would be affected by the closing of financial markets which affected all US money transfers.

A Bank of Butterfield spokesman said: "It is hoped that the US payment system will catch up and get back to normal within a day or so."

A Bank of Bermuda spokeswoman said: "Clients are advised that we do not recommend they attempt money transfers. We will, if they insist, relay instructions as requested, but cannot guarantee the payment will be made."

The spokeswoman added: "All contractual settlement of security sales is immediately suspended. Any trades being submitted will be handled on a contractual purchase, actual sales process for US securities. This will remain in effect until further notice."

Greg Wojciechowski, chief operating officer and soon to be the chief executive officer of the BSX, said he had been in contact with a colleague in the financial district in New York at the time, and another friend who was on his way to the towers had escaped the blast because he was stuck in traffic in New Jersey.

"It is absolutely extraordinary. We are all in shock here. All the staff here offer our sympathy to those who have died in the tragedy and to their families.

"We are going to stay open at the moment. The Fed is still open, the banks are still open and the Government is still open for business. People are still trading and we will continue to trade unless the situation changes. But that does not lesson the horror for the people who have lost their lives and their families."