The chief executive of the multi-billion pound Lloyd’s of London has publicly admitted that the world’s leading insurance market is prepared for a collapse in the single currency and has reduced its exposure “as much as possible” to the crisis-ridden continent.
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Mr Ward says Lloyd’s had been working hard on contingency planning and had the capability to switch settlement of European underwriting from euros to other currencies.
“We’ve got multi-currency functionality and we would switch to multi-currency settlement if the Greeks abandoned the euro and started using the drachma again,” he said.
Lloyd’s has de-risked its asset portfolio in recent years, with investments split equally into cash, corporate bonds and government bonds, mostly in the US, UK, Canada and Australia. “We have de-risked the asset portfolio as much as possible,” he said.
The contingency planning comes as German politicians piled the pressure on Greece ahead of elections on June 17.
A conservative member of German chancellor Angela Merkel’s cabinet said today Germany would not “pour money into a bottomless pit”.
On Sunday, Swiss central bank chief Thomas Jordan admitted his country is drawing up an action plan in the event of the euro’s collapse
Full article: Lloyd’s of London preparing for euro collapse (The Telegraph)
