Who’s exposed to Greece?

Discussion in 'Wall St. News' started by ASusilovic, Apr 28, 2010.

  1. Andere will lose the most
     
  2. This one is pretty obvious - Greek banks are the most exposed.
     
  3. Well short selling Greek banks was banned 28/04/2010 morning !!! A few French banks are heavily exposed (approx 3 firms circa 8 billion EUR) and our 2 favourite Swiss banks as well :D
     
  4. Bloomberg
    Italian Debt Sale to ‘Feel the Heat’ as Greek Contagion Spreads
    April 28, 2010, 7:20 PM EDT


    By Anchalee Worrachate

    April 29 (Bloomberg) -- Demand for Italy’s bonds, a bellwether for securities from Europe’s most indebted nations, may fall at an auction today on concern the financial crisis in Greece is engulfing other countries in the region.

    Italy plans to raise between 5.5 billion euros ($7.2 billion) and 8 billion euros by selling debt maturing in 2012, 2017 and 2020, according to the Treasury. Among peripheral euro governments, it’s the first sale since Standard & Poor’s cut Greece’s credit rating to junk, downgraded Portugal by two steps and lowered Spain by one level this week. Yields on Italian bonds rose yesterday to the highest since April 2009 relative to benchmark German bunds.

    “Italy will feel the heat given contagion is rife,” said Peter Chatwell, a fixed-income strategist at Credit Agricole Corporate and Investment Bank in London. “It would be fantastic if the sale goes well as Italian bonds are normally the safest among euro-zone higher yielders. I don’t see that happening right now. I don’t envisage a failed auction, but it’s not going to be easy.”
     
  5. April 29 (Bloomberg) -- Credit Agricole SA and Societe Generale SA may be among European banks with the most at risk from the Greek crisis because of unprofitable units in the country.

    French banks have the biggest exposure to Greece among European lenders, accounting for $78.8 billion of the $193.1 billion of total claims European banks have on Greece, according to the Bank for International Settlements. They also have the second-largest claims on Portugal and Spain, after German banks, and are the biggest holders of Italian debt, BIS figures show.

    Bond prices from Italy to Ireland slumped after Standard & Poor’s cut Greece’s credit rating below investment grade on April 27 and lowered Portugal as well. A day later the rating company downgraded Spain’s debt. Contagion from the Greek crisis is “threatening the stability of the financial system” like the Ebola virus, Organization for Economic Cooperation and Development Secretary General Angel Gurria said.

    Credit Agricole’s Emporiki Bank of Greece SA has 1.4 million clients and 22.7 billion euros ($30 billion) of loans. The French bank’s main risk in Greece comes from possible loan losses as the economy shrinks, said Jaap Meijer, an analyst at Evolution Securities Ltd. in London. Paris-based Credit Agricole also has stakes in Banco Espirito Santo SA, Portugal’s biggest publicly traded bank by market value, and in Spain’s Bankinter SA.

    “The main French banks have direct exposures on Greek sovereign debt and Credit Agricole has the biggest exposure all in all, when including possible losses on its domestic loan book,” Meijer estimated. He and other analysts said a lack of precise data from banks makes it hard to pinpoint who holds what.

    For a table of European financial institutions’ stated exposure to Greece and Portugal, click here. The figures were provided to Bloomberg News in interviews and e-mails, or culled from company reports and presentations.
     
  6. The breakdown of Greece's debt based on BIS data has been touted on many news sites over the last few days. But one needs to look at such stats with caution. They don't give a further breakdown of those large figures e.g. the USD 64 billion for Switzerland.

    I'm not a journalist but I know for certain that the data on Switzerland is no longer correct, and even if it was still correct, it would be misleading.

    It's obvious that the Swiss media wondered why they seem to have such a large exposure in Greece, since traditionally Switzerland has no special ties to Greece, nor are the big Swiss banks active there, so a Zurich-based newspaper digged into the stats a bit and provided the answer a few days ago.

    The USD 64 billion figure is based mostly on Greek debt or claims owned by the EFG Banking group based in Geneva. EFG is controlled by the Greek billionaire family named Latsis (http://en.wikipedia.org/wiki/Yiannis_Latsis).

    EFG have moved their headquarters to Luxembourg some time ago, so don't be surprised to see a similarly high figure in the 2010 Luxembourg stats :).

    Even if they still had the controlling interest in Geneva, it would be a Greek-controlled banking group based in Switzerland with exposure in Greece. Has hardly anything to do with Switzerland or actual Swiss investors.

    Stats are stats. They're just compiled figures. You need to see the actual breakdown of the invidiual figures as Bloomberg has started to do with the France figure.

    About "real" Swiss banks' exposure:

    According to official data UBS and Credit Suisse held USD 1.9 billion in Greek sovereign debt. That's at the end of September last year. I doubt this figure has changed much. Swiss pension funds which amount to about CHF 600 billion last year held Greek bonds amounting to CHF 1.2 billion. That's hardly worth mentioning.

    There are only two Greek government bonds listed on the Swiss exchange. They total CHF 1.15 billion and are most likely owned by Swiss investors. That's negligible.

    All the details can be found here from this major Swiss newspaper (using Google Translate):

    http://translate.google.com/transla...das-Schweizer-Geld/story/11177251&sl=de&tl=en

    Original article in German here: http://www.tagesanzeiger.ch/wirtsch...riechen-und-das-Schweizer-Geld/story/11177251

    So far they're the only news outlet I know of (including Bloomberg, etc.) that got the USD 64 billion figure puzzle solved.