A financial Dunkirk: Britain draws up plans to rescue expats if Spain and Portugal are hit by financial oblivion



Evacuation plans for British expats stranded in Spain and Portugal if their banking systems collapse are being drawn up by the Foreign Office.

The contingency plans are being put in place to help thousands of Britons if they were unable to get to their money in the event of a catastrophic banking collapse in two of the most vulnerable eurozone economies.

Around one million British expats live in Spain, particularly around Marbella and Malaga, and some 50,000 in Portugal.

Evacuation: The Foreign Office is drawing up plans for the thousands of British expats in Spain - many around Marbella (pictured) - and Portugal in the event of a catastrophic banking collapse

The Foreign Office is concerned that those who have invested savings in their adopted countries would face losing their homes if banks called in loans and they were unable to access money.

Last week ratings agency Standard & Poor's downgraded 10 Spanish banks, including Banco Popular.

Among options being considered for a 'nightmare scenario' include sending planes, ships and coaches to evacuate expats - some through Gibraltar.

Small loans could also be made available to stranded Britons and pressure would be exerted on the Spanish and Portuguese governments to allow access to funds to pay for everyday essentials.

Both countries have a deposit guarantee, like the UK, which means depositors are covered for up to €100,000.

But in the event of a collapse, most banks would limit withdrawals.

Grim warnings: The CaixaBank offices in Madrid, Spain. It was one of 10 Spanish banks to be downgraded by Standard & Poor's this week

Many expats have retired to the south of Spain on fixed incomes, having used their savings to buy villas and apartments.

A senior Foreign Office source told The Sunday Times: 'The nuclear scenario would be having thousands of Brits stranded at the airports in Spain and Portugal with no way to get money from the cash dispenser and no way to get home.

'Who would be blamed for this? The Foreign Office.

'We are looking at how we can help evacuate them if the banks in Spain and Portugal collapse, getting people cash, things like that, sending planes.'

Expats could face losing their villas and apartments because they were unable to afford mortgage payments or withdraw enough cash as banks tried to stop money leaving the country.



They could also lose savings if banks in either country collapsed.

