The launch of one of the largest currencies ever seen in the world has caused scarcely a ripple on the New Zealand banking scene.
The pan-European currency the euro, which came into existence on January 1, has caused a flurry of activity in both Europe and the US as bankers gear up to deal with the first pan-European currency in nearly 2000 years. Many pundits suggested the launch of the euro could rival the Y2K crisis for potential difficulties but none of New Zealand’s banks are reporting anything more than minor teething problems.
“The only real problems we’ve seen have come out of Europe with regards to the reconciliation or settlement of some accounts,” says John McDonald, BNZ’s head of international and treasury operations. McDonald says these issues are easily resolved. “It’s all been a bit of a flash in the pan, really.”
The situation at the ASB Bank is similar. “For us it’s as simple as adding another currency to the list. No problem, no issue,” says general manager of institutional banking Peter Hall. “We have had one or two overseas banks pay us in euro when we were expecting, for example, Dutch guilder, but that’s very quickly resolved.”
If the banks are faring well, their customers seem to be having just as smooth a ride. “They seem to have no real issues,” says Hall, and McDonald agrees, saying BNZ customers seem more than happy with the conversion. “From what we saw on our first day of trading the corporates were adopting more of a wait-and-see approach.”
Banks in both Europe and the US, Europe’s largest trading partner, reported very little trouble with the launch of the currency, which is just as well considering the amount of time and money spent upgrading IT systems to cope.