ECONOMY

Icap prepares system for possible drachma return

Icap, the world’s largest electronic trading platform for foreign currency, has said it is preparing for a possible Greek exit from the common currency area.

Faced with a mounting debt-crisis which threatens the survival of the European Union’s greatest achievement, the eurozone, a number of institutions have announced they are taking steps to deal with a potential collapse.

The firm announced Sunday it is testing systems that would allow dealer banks to trade the drachma, Greece’s old currency, against both the dollar and the euro. Firm representatives described the measures as procautionary.

?There has been enough discussion about a break-up of the euro that we are knocking the dust off the pre-euro [currencies] and making sure everything works,? Ed Brown, executive vice-president of business development and research at Icap Electronic Broking, told the Financial Times newspaper on Sunday.

?Some of these currencies have not traded in a decade,? he said.

The company has reloaded the drachma templates for spot foreign exchange and derivatives which were scrapped when Greece ditched the drachma for the euro in 2001.

“We have built out the currency pair on a contingency basis, coded and tested it,» David Rutter, the firm’s chief executive of electronic broking, told Dow Jones on Sunday.

“On the electronic side of the business, we have to plan far ahead and for various contingencies,» he added.

US President Barack Obama is hosting EU leaders for a summit Monday that is likely to focus on the European debt crisis.

Obama will meet at the White House with European Council President Herman Van Rompuy, European Commission President Jose Manuel Barroso and EU foreign policy chief Catherine Ashton.

Greece’s Finance Minister Evangelos Venizelos is to join his eurozone counterparts in Brussels on Tuesday for talks expected to produce a final decision on the disbursement of a sixth installment of funding from last year?s debt deal — an 8-billion-euro sum without which Greece could face default next month. [Combined reports]