Will Western Union (WU) Stock be Hurt by Suspending Greek Operations?

29 Jun 2015 | Author: | No comments yet »

Western Union Closes Offices in Greece for the Week.

Western Union (WU.N), the world’s largest money transfer company, said it was closed for business in Greece on Monday and would remain closed for at least the rest of the week. The debt crisis in Greece has caused grave problems for banks, as the government has closed the banking system on Monday trying to stop the flow of capital out of the country. Greece’s stock market and banks were closed Monday and ATM withdrawals have been limited as well. “Western Union has not seen any significant peak of change in our outbound business from Greece over the course of the past 60 days,” the company said. “Our inbound business is, however, seeing an upswing.”

As detailed by ValueWalk, following the announcement of the plan for a referendum in Greece, the European Central Bank made a call to not extend additional emergency finance to the Greek banks, after the breakdown of talks on giving heavily indebted Greece the last payment of its international bailout. The desperate measures by the government follow the weekend decision by Alexis Tsipras the Prime Minister to call a referendum on the proposals from creditors for more Greek reforms in exchange for the bailout funds that are so vital. With newspaper in Greece splashing their front pages with huge photos of people standing in line in front of cash machines and long lines of cars at gas stations, the government acted by closing all banks until at least July 6, the date for the referendum and to shut down all its cash machines for the next 24 hours. Tourists carrying credit or debit card to ATMs before there is no more cash, can exceed that upper limit, which is a necessity as many businesses in Greece started turning down use of credit cards to just cash only transactions.

The crisis-wrecked country reels from an overnight Government decision to shut all banks and the stock market for six business days and impose restrictions on cash machine withdrawals. Western Union said its inbound business was seeing a big upswing and would continue to monitor that closely and when the business in the country is operational again, the company would open.

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