IMF Preparing Greek Default Contingency Plan
The biggest slow motion trainwreck in history, one that everyone knows how it ends just not when (especially since the “when” is about 5 years overdue), that of the Greek sovereign default may just got a bit more exciting earlier today when the WSJ reported that the IMF can no longer lie – like Mario Draghi did to Zero Hedge in 2013 – that there are preparation for a Plan B. To wit: “the International Monetary Fund is working with national authorities in southeastern Europe on contingency plans for a Greek default, a senior fund official said—a rare public admission that regulators are preparing for the potential failure to agree on continued aid for Athens.”
According to the WSJ, the IMF is focusing on nations neighboring Greece, asking their national banking supervisors to “ensure that subsidiaries of Greek banks have enough assets that they can exchange for emergency financing at their own central banks—in case financing from their parent institutions is suddenly cut off—and that deposit-insurance funds are at sufficient levels, Mr. Decressin said.”
In other words, have a Greek default Plan B ready, preferably right now.
“We are in a dialogue with all of these countries,” said Jörg Decressin, deputy director of the IMF’s Europe department. “We are talking with them about the contingency plans they have, what measures they can take.”Greek banks are big players in some of its neighbors’ financial systems. In Bulgaria, subsidiaries of National Bank of Greece SA, Alpha Bank SA, Piraeus Bank SA and Eurobank Ergasias SA own around 22% of banking assets, roughly the same as Greek banks own in Macedonia. Greek banks are also active in Romania, Albania and Serbia.
…click on the above link to read the rest of the article…
