The Volatile exchange rate from Europe’s debt crisis has increased the risks of holding existing reserve currencies. According to the Chief Executive of Russia’s second largest bank, more alternatives are needed to meet this risk.

The Euro had dipped 16% this year. It dropped below $1.20 for the first time since March 2006. This drop is caused by a 750 billion-Euro emergency loan package taken by Greece last month. For this loan, both the European Union and the International Monetary Fund contributed.

“The recent financial instability shows, if not the complete failure of currencies like Dollars and Euros, but also the threats which are existing in the present financial system”, said Andrei Kostin, Chief Executive of VTB Group, at a press conference ahead of a World Economic Forum meeting in Ho Chi Minh City, Vietnam.

Russia and China are settling their cross-border business in their national currencies i. e. Rubles and Yuan, thereby, ignoring the U. S Dollars. This is making the business moving from Dollar-denomination. China, at present, has the world’s largest foreign currency reserves with it. Chinese Premier Wen Jibao has also showed his concern for the Dollars future.

More discussion for reserving currencies are needed in Europe.