GREEK VOTE – Bankers On Alert and Prepared
U.S. Banks have been intensely practicing financial defensive strategies in preparation for another potential financial crisis and have stepped up contingency plans to diffuse a possible major financial fallout because of the Greek Vote and what may happen because of the Vote.
After witnessing Greece waver as they tried to comply with the March bailout terms to keep Greece in the European Union, the banking industry moved forward with their defensive programs in preparation of Greece exiting the EU and taking all measure to prevent major disaster as a result of the exit including setting up Crisis Teams at banks in New York and London.
Legal implications have been a major consideration because of banking contracts including loans, bonds and other bank instruments and agreements. There is possibility that a contract could end up in the wrong currency because of changes to the currencies as a result of the Vote. And as a precaution some banks are attempting to move their contracts to more favorable venues to hopefully have agreements operating in the more valuable and favorable currency should there be currency issues.
Banking preparations included practice dry runs to handle possible scenarios that may occur if Greece exits the European Union or other countries leaving the EU or even the dissolution of the EU. For instance in the case of a new currency, test runs have been made for Bankers to practice working a potential new currency.
Bankers with large exposure in Euro countries tested to be sure large funds could be readily transferred from one country to another without issues and making sure those payment system were working successfully.
Clients have been demanding communication with their bankers European divisions and branches for financial news updates for direction and to decide what to do next.
Like the rest of the world bankers are waiting to see what happens and this time many are better prepared.