Analysts at Evolution Securities Ltd. claim that the European banking system may collapse if the region gives up the single currency. According to them, if the countries return to their national currencies, there will be an immediate wave of devaluations across the former euro area and European banks will become insolvent. Such outcome would also have an extremely negative impact on the multinationals as there are now too many cross-border investments in Europe.

The specialists estimate the losses of French, German and British banks in case of euro’s collapse by 360 billion euro ($479 billion). The devaluation after the national currencies are relaunched is thought to be 30%. As a result, Evolution Securities analysts believe that the region’s economies won’t be able to survive separately anymore and all they can do is to keep integrating and moving to the fiscal union.

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