EU Economics

Banks prepare for ‘economic nuclear winter’ Senior banking analyst warns of EU APOCALYPSE

BANKS are preparing for the worst in the second half of the year as it faces an ‘economic nuclear winter’, a major investment bank expert has warned.

Banks are preparing for

GETTY    Analysts have warned banks to prepare for the worse.

A series of political shocks – including Britain’s vote to leave the EU – have led to fears the entire Union could crumble, the currency could collapse and economic nightmares could become a reality.Now it has been revealed this kind of “economic nuclear winter situation” is being prepared for by major banks.

Weak corporate earnings, a banking crisis, and the Brexit vote have sparked disaster planning for the worst case scenarios in the second half of the year.

Banks are preparing for

GETTY    A series of political shocks – including Brexit – have led to fears the entire Union

“The banks are ready for anything now.”

After the United Kingdom voted to leave the European Union in June, there have been talks a similar referendum may be held in France, the Netherlands and other countries.

The source added: “Markets hate uncertainty and the events this year have unfortunately created a lot of mystery around what is going to happen next.”

The Euro could be at risk - analysts have said

GETTY      Predictions include the collapse of the Euro and further withdrawals from the Union

Shares in the biggest banks have been plummeting in recent weeks putting weight behind what, months ago, would have been seen as wild predictions.Deutsche Bank has lost almost 45 percent, Credit Suisse has lost 41 percent and the Royal Bank of Scotland went down 35 percent in 2016.

Uncertainty and volatility has been spotted in all areas of the economy from mining to car production.

Britain’s leave vote is widely seen as the biggest uncertainty on the global financial agenda.Analysts, however, have urge companies not to give in to panic and hysteria – but told them to keep on working and make steps to “de-risking and simplifying their businesses.”

Laith Khalaf, senior analyst at Hargreaves Lansdown told CNBC: “I think the main problem for the second half of the year is the uncertainty caused by Brexit, though that’s likely to persist for two years or more, so I suspect companies are likely to roll up their sleeves and get on with their business.”

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