Greece: UK 'Steps Up' Preparations For Grexit

A spokeswoman for David Cameron has said that Number 10 is 'stepping up' plans for a possible Greek exit from the eurozone.

Potential contagion has prompted the UK government to focus its attention on the ramifications of a Greek exit from the eurozone.

Greece's continued membership of the European Union (EU) is also being called into question should a deal not be agreed in the coming days.

A government spokeswoman said: "You can expect that we are continuing to make sure we have the right plans in place and stepping up preparations given where discussions have got to."

Downing Street made its comment as a war of words continued to flare.

Greece's Prime Minister Alexis Tsipras called the International Monetary Fund (IMF) "criminals" - after accusing them and Greece's other two creditors, the European Central Bank (ECB) and European Union (EU), - of trying to 'humiliate' the Greek people.

In a televised address to members of his Syriza party, he accused the lenders of being politically motivated in their demands for pension cuts and tax hikes that would hit the poor.

But European Commission President Jean-Claude Juncker said he had been clear with Mr Tsipras that he was against increasing taxes on power and pharmaceuticals.

"I’m blaming the Greek government for telling things to the Greek public which are not consistent with what I told the Greek prime minister," he said.

Jeroen Dijsselbloem, the Eurogroup president, said on Twitter (Xetra: A1W6XZ - news) that he would propose that the elections for his successor should be postponed until July so that focus can remain on Greece.

"Greece requires all attention. And, election should not lead to debate on procedures," he wrote.

The ECB's Governing Council meets later in Frankfurt to discuss further Emergency Liquidity Assistance (ELA) to Greece's beleaguered banks.

ELA, by the ECB’s own definition, can be provided only "to a solvent financial institution, or group of solvent financial institutions, that is facing temporary liquidity problems”.

However, since the Greek banks are essentially the sole purchasers of outstanding Greek government T-bills - the crucial source of day to day funding for the Greek government - and that the Greek finance minister, Yanis Varoufakis, has declared the Greek state "bankrupt" it is hard to argue that the banks themselves are solvent and therefore eligible for further ELA funding.

Klaas Knot, a member of the ECB's Governing Council has suppressed speculation on anything 'heavy handed' being prescribed at today's meeting saying that ELA will continue until Greece defaults on its payments.

It has until 30 June to make a 1.6bn euro (£1.15bn) debt repayment to the IMF.

To manage relations with the IMF Greece has appointed Michalis Psalidopoulos as the new Greek representative at the IMF.

Investors are not optimistic, dumping stock in Greek banks. National Bank (NYSE: NBHC - news) of Greece plummeted by 11% on Tuesday as fears that ECB would turn off the funding 'taps' imminently.

Senior German politicians have also started openly discussing the implications of Greece's exit from the single currency, as one of Chancellor Angela Merkel's coalition allies called Greece's ruling politicians of failing to grasp the seriousness of the situation.

"They are behaving like clowns sitting in the back of the classroom, although they have received explicit warnings from all sides that they might fail to pass to the next grade," Christian Social Union Secretary-General Andreas Scheuer wrote.

As levels of fear escalate holidaymakers were being advised to carry more cash than they would otherwise in the event of a Greek banking crisis.

Sky News contacted Visa (Xetra: A0NC7B - news) who said a system for processing payments would remain irrespective of Greece's euro-membership status.

"Visa regularly changes, adds or deletes currencies from its systems. When a country exits a currency, we take steps to remove the old and add the new currency into our systems, meaning that the system for processing payments is still in place," it said.

Meanwhile, Ryanair - who in the last year have doubled their Greek operations, including somewhat ironically launching a new route to Brussels - were fairly sanguine on the Greek crisis.

"We have no exposure to the Greek banking system," it said.

Britons are the second biggest group of tourists who travel to Greece and its Islands with spending totaling €1.4bn in 2013, according the Greek tourist board.

The Athex Large Cap index which tracks the fortunes of the largest 25 Greek companies was fairly ambivalent to the news -just 0.4% lower at lunchtime. The index has fallen by over 17% so far this year.