Credit ratings agency Moody's Investor Service said the banking systems in Portugal, Italy, Spain, Ireland and Britain could all be hurt by a widening debt crisis.
With Spain seeing its borrowing costs jump in its latest bond issue — a clear sign of market fear, since investors demand higher rates from borrowers they see as riskier — Europe remained delicately poised at a juncture.
Moody's said much depended on bailout loans agreed for Greece, and whether that was seen as decisive in keeping that country away from bankruptcy. Greece faces a May 19 repayment date and the loan money is expected to get there after approval by national parliaments, but its longer term prospects are less certain.
"A key factor determining whether contagion risk continues in this case will be the market's view of the likely success or otherwise of the recently agreed International Monetary Fund and European Union support package for Greece," Moody's said.
That bailout offers the debt-ridden country €110 billion ($142 billion) in loans over three years from the IMF and the other 15 countries that use the euro.
[247] 06.05.2010 Source: Associated Press
Popular News
US gains access to European banking data - 01.08.2010 US terror investigators can now take advantage of the terms of an agreement drawn up with the EU, which gives them access to the details of bank transfers taking place between the EU and the rest of the world. Source: Deutsche Welle
Results of the 2010 EU-wide stress testing exercise - 23.07.2010 Further to its statements issued on 18 June, 7 July and 19 July 2010, CEBS today releases its summary report on the results of the EU-wide stress test exercise. Source: The Committee of European Banking Supervisors (CEBS)
European banks face stress test - 08.07.2010 The European Union and European Central Bank are pushing for more than 100 European banks to be stress tested, in an effort to avert another financial crisis. Source: Financial News
Siemens plans to set up its own bank - 30.06.2010 German industrial conglomerate Siemens AG plans to set up a bank of its own in an effort to reduce risks of financing difficulties following the economic crisis, the company said Monday. Source: Associated Press
Greek leader considers action against US banks - 17.05.2010 Greece may investigate U.S. investment banks and their role in the run-up to the Greek debt crisis which has shaken faith in euro zone economies, Prime Minister George Papandreou said in comments broadcast on Sunday. Source: Reuters
