The euro: coming to a bank near you
By : Jeffrey Sparshott
The European Central Bank (ECB) (http://www.euro.ecb.int) will start trucking euro notes and coins to commercial banks in the European Union (EU) (http://www.europa.eu.int/index_en.htm) Saturday as institutions begin to stock up on the currency that will replace the German deutsche mark, French franc and other national legal tender during 2002.
The currency changeover will have direct and indirect consequences for Polish companies and individuals and the logistical challenge of implementing the new money will be significant, though Poland and other non-EU countries are not entitled to start loading up on the new bills until Dec. 1, leaving less time to gather the currency and for training on security and other features.
While the zloty will remain legal tender in Poland for the foreseeable future, the National Bank of Poland (NBP) and commercial banks across the country will be required to change the 12 European monetary union national currencies held by Polish citizens to euros (http://www.euro.ecb.int) starting Jan. 1. The pending change is causing concern over a potential influx of bogus deutsche marks or other national currencies as counterfeiters look to unload soon-to-be-useless forgeries.
"If we are speaking about counterfeiting I think that in Poland the danger could be an attempt to put into circulation some fake German marks," said Krzysztof Jakubiszyn, adviser to the National Bank of Poland's president. "Fake euros during the first months will be a problem for the original 12 countries but not as much for Poland because the euro will not be born on our territory."
Limited time to train commercial and national bank personnel and a rush to change money could cause some errors, though the overall volume of NBP money changing is expected to be limited, he said.
"Our very rough estimate for the first two months could be in the range of some E20 million-E30 million, or for the first half could be some E50 million-E60 million," he said, referring only to the NBP's needs. "That is just an estimate. The unknown factor is hoarded money. No one can give an accurate estimate."
According to one guess, up to 40% of all German banknotes and coins circulate outside of Germany, with the heaviest use falling in Turkey and the former Yugoslavia. No one, not Germany's Bundesbank, the ECB or the NBP, knows how many deutsche marks are circulating in Poland among money changers or possibly hidden away in mattresses or behind framed copies of the Black Madonna.
"Some people have their savings in foreign currencies kept 'under the pillow,'" said Andrzej Obara, director of Bank Przemyslowo-Handlowy's (BPH) international department. "The most popular currency is the U.S. dollar, but there is still a certain amount of deutsche marks or schillings, etc., and this money will be changed into the euro. But the exact amount cannot be estimated."
Most Polish banks will receive the currency from foreign parents or strategic partners and are already encouraging clients to deposit foreign currencies now, rather than wait until the official change.
"We try to attract customers to convert their accounts into euros by themselves," Obara said. "For example, we do not charge (until the end of November) for changing the loan currency from a national currency into the euro. All accounts not converted by customers will be converted automatically by the bank."
Ireneusz Kaminski, head of the Euro Info Center in Warsaw, is working with Polish companies to help them prepare for the new currency.
"It has both a direct and indirect impact on their activities," Kaminski said. Companies either functioning in or trading with the 12 countries of the euro zone will see, for example, a stronger unification of prices on certain merchandise and thus a more competitive environment for producers and importers. Polish companies will have to convert prices, adjust accounting procedures, adapt relevant software and train staff.
"These types of consequences may be perceived as a kind of cost to companies," Kaminski said. "They will be counterbalanced by the creation of a broad market of more than 300 million consumers, who will benefit the competitive enterprises."
The deutsche mark will cease to be issued Jan. 1, 2002, though it will circulate in tandem with the euro until Feb. 28, 2002. After that date, the mark will no longer be used for cash or electronic transactions, though Germany's central bank will continue to convert it at a set exchange rate indefinitely.
"There is no reason for panicking or a stampede or something because the changeover is plausible for all people holding deutsche marks even after Feb. 28," said Werner Becker, an economist with Deutsche Bank Research.
The timeframe for the changeover is different in other countries.
