Sun, Jun 25, 2017
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

Preparing for the unthinkable: Dechert advises on risk planning in the event of a eurozone exit

Wednesday, March 21, 2012

Beverly Chandler, Opalesque London: A legal update from Dechert’s Financial Services Group, The Eurozone Crisis: Risk Planning for Asset Managers, aims to advise asset managers in the case of one of more of the EU states leaving the eurozone.

The firm estimates that in an extreme situation, the crisis could result in one or more of the following 'euro’ events:

  • a dramatic loss of confidence in the ability of the exiting state to maintain its financial creditability;
  • transfer of funds away from financial institutions in the exiting state by domestic as well as foreign depositors
  • fund transfers accelerate into a run on the banks;
  • imposition of exchange and capital controls by the exiting state to prevent an exodus of capital;
  • the exiting state leaves the eurozone (unilaterally or by some form of agreement) and redenominated its euros into a new domestic currency;
  • this is followed by significant inflation and devaluation of the redenominated currency against the euro;
  • affected banks and other institutions default by on their obligations, triggering creditors’ claims and leading in some to insolvency or nationalisation;
  • (conceivably) the imposition of border controls by the exiting state to prevent a temporary population shift out of the exiting state; and
  • considerable uncertainty as to the correct legal chara......................

    To view our full article Click here

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing

 



  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. FinTech - Rise of robots: Inside the world's fastest growing hedge funds[more]

    From Bloomberg.com: Believe the hype. Quants have never been more popular. After doubling over the past decade, assets run by so-called systematic funds have hit a record $500 billion this year, according to estimates from Barclays Plc. In some ways, their meteoric rise is due to the same technolog

  2. Legal - Bond market concerns could scuttle Paulson's Fannie-Freddie plan[more]

    From Bloomberg.com: A hedge fund proposal for freeing Fannie Mae and Freddie Mac from U.S. control is poised to face stiff opposition from investors who say it risks wrecking the mortgage-bond market. The Moelis & Co. blueprint, which firms including Paulson & Co. and Blackstone Group LP sponsored,

  3. Other Voices: Are your pricing policies and procedures for less liquid instruments adequate?[more]

    Komfie Manalo, Opalesque Asia: The unrelated position mismarking incidents that quickly precipitated the closures of both Visium Asset Management and Marinus Capital have been recent focal points for market participants, but regulatory scrutiny of valuation choices for less liquid instruments is

  4. FinTech - AI hedge fund Numerai now live on Ethereum, Cryptocurrency hedge funds generate huge returns as bitcoin surges[more]

    AI hedge fund Numerai now live on Ethereum From Cryptoninjas.net: Back in February, Numerai announced numeraire (NMR), a cryptographic token to incentivize a new kind of hedge fund built by a network of data scientists. Earlier today, the Numeraire smart contract was officially deployed

  5. Investing - Advisors slash hedge fund positions, Theravance Biopharma is a top pick of investment guru Seth Klarman, As asset management industry grows a search for new revenue streams[more]

    Advisors slash hedge fund positions From Barrons.com: Financial advisors have cut wealthy clients' exposure to hedge funds by up to one third over the past 12 months, The Financial Times reports. Advisor firms in the FT's annual top-300 ranking have reduced their hedge fund allocation to