Funding risk: Eurozone risk matrix

What might be the funding risk?

A member state exit is likely to result in increased liquidity problems and less available funding as financial institutions manage their exposure to the Eurozone. Businesses may find that traditional sources of finance (loans, bonds etc) are less easy to obtain or raise.

Intra group funding may also be problematic if there are intra-company loans to subsidiaries located in risk member states and those subsidiaries are having difficulty meeting their payment obligations under such loans.

Businesses may need to give some thought as to how to manage possible funding shortfalls. Those businesses with large cash reserves and assets will obviously be better placed to manage any funding shortfall in the short to medium term.