# Irish Euro vs French Euro



## Laoisa (16 Nov 2011)

Hi, 
am still scrambling to change euros in Irish banks to other currencies. If we revert to the punt will french euro's be ok  or would it be wise to change the french euro as well. Any suggestions gratefully accepted. Thanks Laoisa


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## ClubMan (16 Nov 2011)

You mean _French _euro coins? All euro coins/notes are equal.


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## onq (16 Nov 2011)

Laoisa said:


> Hi,
> am still scrambling to change euros in Irish banks to other currencies.




New form of exercise?


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## rekhib (17 Nov 2011)

Hi Laoisa, I've done the same, holding about 80% of my cash in 'French' euro. The rest is in Australian Dollars and US Dollars. The rationale behind holding your cash in a particular currency (or soon-to-be-currency) should be that you can use it if worse came to worst. I.e. don't just hold your cash in a particular currency because you think it will outperform the 'Irish' euro. You don't want all of your money in, Australian Dollars for example if you have no tie to the place, even if you think the currency will perform well against the Irish euro, it's just too much of a risk. Despite the fact that France are coming under pressure at the moment, they're still part of the core of the EUR so their currency should remain strong, particularly compared to the punt nua. Hope that helps.


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## ClubMan (17 Nov 2011)

rekhib said:


> 'French' euro


What does that mean? € deposits in a _French _bank? Or a pile of these?

http://en.wikipedia.org/wiki/French_euro_coins


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## onq (17 Nov 2011)

Someone spoke about this to me only last week as it happens and they suggest that what may happen is that all monies may be "repatriated" to the currency of their "owner's" nationality.

This is rank speculation and without any foundation that I could seem but it would be interesting to learn more.


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## rekhib (17 Nov 2011)

Hi ClubMan, sorry for the confusion. Neither, necessarily. A bank with French IBANs, i.e. HSBC aren't French but they have French IBANs. Rabo aren't Irish but they have Irish IBANs. So, in the event of a break-up, the currency would be converted to the national currency of wherever your IBAN falls. When I say 'French' euro, I mean EUR in a French bank a/c but it doesn't have to be a French bank.


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## shnaek (17 Nov 2011)

onq said:


> Someone spoke about this to me only last week as it happens and they suggest that what may happen is that all monies may be "repatriated" to the currency of their "owner's" nationality.


Couldn't be done by nationality. It'd have to be done by residency. And what date would they use to determine residency? Perhaps the date of the conversion itself. But what about corporate accounts? And why punish the saver and save the borrower? Whatever way this plays out, best to have a top financial advisor on speed dial.


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## rekhib (17 Nov 2011)

Interesting idea on the repatriation. I think there's a big logistical headache there. What happens if I'm Irish and I have only 1 bank a/c located in Germany. Where would they repatriate the money to? Could it come to you being forced to open a 'home' bank a/c, eeek, scary. Can you find that idea referenced in the media onq?


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## ClubMan (17 Nov 2011)

rekhib said:


> So, in the event of a break-up, the currency would be converted to the national currency of wherever your IBAN falls.


Where has this been stated?


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## Slim (17 Nov 2011)

rekhib said:


> Hi ClubMan, sorry for the confusion. Neither, necessarily. A bank with French IBANs, i.e. HSBC aren't French but they have French IBANs. Rabo aren't Irish but they have Irish IBANs. So, in the event of a break-up, the currency would be converted to the national currency of wherever your IBAN falls. When I say 'French' euro, I mean EUR in a French bank a/c but it doesn't have to be a French bank.


 
Does anyone know for sure how this would work in the event that Ireland exited the euro currency? Would international banks which have a physical presence here, e.g. Danske(NIB), RBS(ULster Bank) etc, simply convert all your deposits/debts to the punt nua? Would banks which only exist here on the internet, i.e. Rabo, have to do the same? OR would it be that any bank regulated by IFSRA would convert all Irish accounts to the £IR? I strongly suspect that your euro deposits would not be safe in either case. Only euro cash, regrardless of origin, in your wallet or mattress would be safe along with non resident accounts held in other euro zone countries, in my opinion.

In the event that there are exits from the euro, I believe the euro itself would suffer a devaluation, however temporary, against the other international currencies, $ or CHF.


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## rekhib (17 Nov 2011)

ClubMan said:


> Where has this been stated?


 
It's pure speculation. I don't think there will be much forewarning about how events will play out from the Euro-area governments so getting our hands on concrete facts about how a break-up would ensue is nigh on impossible.

That said, I think the most likely course of action is that deposits will be converted based on where the bank a/c is domiciled, as opposed to the bank, the bank group, the a/c holder or even the a/c holder at the time of transfer. All other options have insurmountable logistical headaches. It's also the only option which wouldn't see swathes of money effectively being 'transferred' between sovereign nations.


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## shnaek (17 Nov 2011)

rekhib said:


> That said, I think the most likely course of action is that deposits will be converted based on where the bank a/c is domiciled.


Where is a bank account domiciled? What is that based on?

Also, they couldn't really go by IBAN, because then all you'd have to do is move it twice. They would hardly go to the trouble and expense of tracing back through all IBANS back to the origin.


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## rekhib (17 Nov 2011)

shnaek said:


> Where is a bank account domiciled? What is that based on?


 
If your bank a/c's IBAN begins with IE, for example, that would be converted to the new currency of Ireland. If your IBAN begins with FR, that would be converted to France's new currency and so on.

Yes, I agree with your point, tracking back transactions to a point of origin would be a bizarre, costly and ultimately unworkable course of action. Any conversion that takes place has to be at a specific point-in-time. 

Not that protecting your wealth isn't a legitimate reason for transferring money to a different state's banking system but there are many legitimate reasons why people and corporations move money across borders. The concept of tracing that money back to where it's 'supposed to be' and then converting it to that country's currency is just nonsensical.


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## ClubMan (17 Nov 2011)

Seems to me that this whole thread is about a concept/entity that does not even exist - e.g. a _French _versus _Irish _€ - and as such seems to be of questionable merit?


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## rekhib (17 Nov 2011)

The thread is about protecting your deposits in the event that there was a break-up of the Eurozone. Shouldn't the merit of a particular thread be judged by the OP?


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## ClubMan (17 Nov 2011)

It's a discussion forum - people are free to post their opinion - as I just did.


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## Troy McClure (18 Nov 2011)

Its a good question poorly phrased.

I agree with the above. Where ever the account is opened is where it will transfer to whatever is new currency. If it's Rabo opened in Ireland then it's in Ireland. If it's HSBC in France its in France. There is no way on earth it could be broken down to anything else unless they pass some new mad euro legislation or directive. Right now they have bigger fish to fry..


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## Swyper (21 Nov 2011)

rekhib said:


> If your bank a/c's IBAN begins with IE, for example, that would be converted to the new currency of Ireland. If your IBAN begins with FR, that would be converted to France's new currency and so on.
> 
> Yes, I agree with your point, tracking back transactions to a point of origin would be a bizarre, costly and ultimately unworkable course of action. Any conversion that takes place has to be at a specific point-in-time.
> 
> Not that protecting your wealth isn't a legitimate reason for transferring money to a different state's banking system but there are many legitimate reasons why people and corporations move money across borders. The concept of tracing that money back to where it's 'supposed to be' and then converting it to that country's currency is just nonsensical.



This is already starting. If it can happen with Swiss accounts for Greek residents, it can happen for German accounts for Irish residents.

h t t p : / / w w w . z e r o h e d g e . c o m /contributed/capital-flight-and-forced-repatriation

If the euro breaks up, all bets are off lads. Capital controls and repatriation (i.e. forced conversion at a set rate and date) will happen. My guess is that it will be based on the residency of the account holder.


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## elcato (21 Nov 2011)

I'm just keeping all the notes I have that their serial number start with a Z, cos they are apparently German euro notes. So if the euro goes I'll have their currency.


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## seesaw (21 Nov 2011)

It looks like the whole scramble for foreign euro bank accounts is a waste of time. I think the idea that in the event of a breakup an account in France/Germany/Netherlands with an Irish address would be converted to punts is what would most likely happen. 
Its similar to people initially moving their money from Irish owned banks in Ireland to foreign banks in Ireland and then realising they still weren't safe. 
The only way out of that scenario is to transfer out of the euro and run the exchange risk.


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## Troy McClure (21 Nov 2011)

Thats an interesting article Swyper. However nowhere in it does it mention moving money from Euro to Euro. From the below quote from the article I would have thought it is looking at money going outside the Eurozone.

"_The European Commission is working with Switzerland and Greece stop what it believes is an __ongoing exodus of money from Greek bank accounts into Swiss and other offshore banking centers, the EU official said."_


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## Swyper (21 Nov 2011)

Troy McClure said:


> Thats an interesting article Swyper. However nowhere in it does it mention moving money from Euro to Euro. From the below quote from the article I would have thought it is looking at money going outside the Eurozone.
> 
> "_The European Commission is working with Switzerland and Greece stop what it believes is an __ongoing exodus of money from Greek bank accounts into Swiss and other offshore banking centers, the EU official said."_


 
I guess for me, it's not so much what the article says, but what it is pointing to in terms of possibilities and precedent. If you think that the EU/ECB is going to be happy filling Irish banks with Euros which later on get converted to pre-devaluation punts (with the EU/ECB taking the FX loss), while Irish residents pour money into German banks waiting for a devaluation, then you should go ahead and put money into your German bank account. 
In my view, it is a very easy thing to do once the Swiss/Greek precedent has been set.

Let's look at it from the other side. If the European authorities did NOT do this, then they would effectively be rewarding those who magnified an existing crisis. If Irish borrowers get a huge write-down in debt through the conversion of debt to pre-devaluation punts, then you can be sure that the cost of that is going to pushed to Irish savers through the same mechanism. Otherwise it would, in effect, be German taxpayers paying for Irish debt write-down by the backdoor.

For me, putting all your money into German (or worse, French) deposit accounts is not a good hedge. A diversification across non-Euro denominated cash and assets is the best way to diversify if you think Ireland and the Euro will divorce.


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## 44brendan (21 Nov 2011)

This discussion can't be for real!! Does anybody really think that in the event of a Euro break up that German/French issued notes will be more valuable than Irish issued notes. This is a surreal concept and has absolutely no basis in fact.


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## Troy McClure (21 Nov 2011)

Brussels wont mind as long as some Euro bank is getting the deposits. Do they expect taxpayers here to bail out large Euro banks and not be able to use them. It would also, and I am open to correction, break the law as it stands in Europe. 
It would be lunacy as if this were true it would cause a cash run on banks. There would be bags of cash buried all over the place.
I think this is a timely rumour started by an Irish bank official..


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## Troy McClure (21 Nov 2011)

44brendan said:


> This discussion can't be for real!! Does anybody really think that in the event of a Euro break up that German/French issued notes will be more valuable than Irish issued notes. This is a surreal concept and has absolutely no basis in fact.


 
I dont thing your getting the point. If there is a breakup there will be a devaluation here. The notes 'in hand' will be worth the same but there would like be a devaluation of debts and savings in banks. In stronger countries their newer currency would likely appreciate.


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## Swyper (21 Nov 2011)

Troy McClure said:


> Brussels wont mind as long as some Euro bank is getting the deposits. Do they expect taxpayers here to bail out large Euro banks and not be able to use them. It would also, and I am open to correction, break the law as it stands in Europe.
> It would be lunacy as if this were true it would cause a cash run on banks. There would be bags of cash buried all over the place.
> I think this is a timely rumour started by an Irish bank official..



I think you're making the mistake of assuming they give a rats ass about the Irish taxpayer.

And "the law" is the worst argument that this wouldn't happen. There's no law that allows the ECB to lend to countries. So what does it do? It lends to the IMF who lend to eurozone countries. There is no law that allows for the forced conversion of Irish-based eurozone deposits into punts. We're in a zone where events are infinitely faster than the ability of the law to catch up.

If the European authorities *don't* impose any forced repatriation of deposits, then it would be a huge giveaway to Irish borrowers at the expense of European taxpayers. With Italy and Spain now in our boat, that will not be allowed to happen.


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## Ethan 1 (22 Nov 2011)

elcato said:


> I'm just keeping all the notes I have that their serial number start with a *Z*, cos they are apparently German euro notes. So if the euro goes I'll have their currency.



I hope you mean X or you have just accumulated a large amount of €'s from a country with no Govt.

http://en.wikipedia.org/wiki/Euro_banknotes


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## elcato (22 Nov 2011)

> I hope you mean X or you have just accumulated a large amount of €'s from a country with no Govt.


I wrote that wikipedia page as well. I just want others to be fooled so I'm the only one to get the 'right' euro notes. Shh now.


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## shnaek (22 Nov 2011)

Swyper said:


> Let's look at it from the other side. If the European authorities did NOT do this, then they would effectively be rewarding those who magnified an existing crisis.


Rewarding those who magnified the crisis? That would never happen. Sher haven't even the people who created the crisis been held to account.


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## Ethan 1 (25 Nov 2011)

elcato said:


> I wrote that wikipedia page as well. I just want others to be fooled so I'm the only one to get the 'right' euro notes. Shh now.


Writing a wiki page is good but what really impressed was you've hacked the ECB

http://www.ecb.int/euro/banknotes/html/index.en.html

Any chance you could drop a few zeros from our account, quiet a few would help


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## Swyper (26 Nov 2011)

Interesting one:

"_On Friday, Merrill Lynch became the latest to issue a report exploring what would happen if countries were to exit the euro and revert to their old currencies. If Spain, Italy, Portugal and France were to start printing their old money again today, their currencies would most likely weaken against the dollar, reflecting the relative weakness of their economies, Merrill Lynch calculated. Currencies in the stronger economies of Germany, the Netherlands and *Ireland* would probably rise against the dollar, according to the analysis_."

http://www.nytimes.com/2011/11/26/b...eakup-of-the-euro-zone.html?pagewanted=2&_r=1


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## Time (26 Nov 2011)

Well people in Greece are empting their bank accounts and hoarding Euro banknotes in case the Euro is suddenly withdrawn. There will be no warning at all of any re-denomination.


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## Swyper (29 Nov 2011)

Spam


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