The traditional European holidaymakers, however, continue to change their money into Swiss francs. 2  BIS Review 73/2002  In practice, most businesses apply the current rate plus a margin of 2%-3% when payment is made in euros. The majority of businesses only accept euro banknotes and return change in Swiss francs; a minority also accept euro coins, giving the change in euros. The management of coins is made more difficult because most banks do not buy or sell coins. All businesses queried feel that the simplification brought about by the replacement of the former European currencies with the single currency is positive. With regard to the euro as deposit money, many export companies switched to billing in euros relatively soon after the introduction of the single currency. Consequently, this practice has not become significantly more prevalent in the most recent past. Invoicing in euros of exports destined for the euro zone is widespread. Producers of some niche and luxury products are an exception. They continue to bill in Swiss francs. Euro-denominated receipts are hedged in exceptional cases only; companies still consider hedging on the financial markets to be too expensive. What is widely practised, however, is so-called “natural hedging”, which means that receipts in euros are used to settle suppliers' invoices: primary products and raw materials from the euro zone are paid for in euros. Swiss suppliers have increasingly been requested to provide euro-denominated invoicing. It is unclear to what extent inter-company payments in Switzerland are effected in euros.

(…) With credit and money markets essentially frozen and equity prices plummeting, banks and other financial firms saw their access to funding eroded and their capital shrink owing to accumulating mark to market losses.” The Lehman bankruptcy had triggered a widespread crisis of confidence. Among other repercussions of the Lehman Brothers collapse, the above-mentioned virtually completed sale of Glitnir assets did not materialise. This kicked off the well-known chain of events. Glitnir turned to the Central Bank for assistance. Not only was the bank unsuccessful in its attempt to sell assets, it was unable to renew a bank loan that it had expected to extend without any difficulty. Ultimately, the Government decided that the Treasury should acquire a majority holding in Glitnir, but before that could be finalised, the bank collapsed. In early October, there was substantial pressure on Landsbanki’s deposit accounts in London, and the British Financial Services Authority (FSA) steadily tightened the demands it made on the bank. Landsbanki’s liquidity difficulties became insurmountable, and it was clear that rescuing the bank would not represent prudent use of the Central Bank’s foreign exchange reserves. The amounts involved were simply too large. By this time, only Kaupthing remained of the three large banks. In view of the prospects for Kaupthing’s liquidity, the bank was deemed likely to survive the storm. On the basis of that assumption, the Central Bank, after consulting the Government, granted Kaupthing a collateralized fourday loan that should have sufficed – as things stood then.