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Euronews.net - The size of the losses faced by banks that have lent money to Greece is set to rise and those banks are coming under increasing pressure to raise their reserves to cope with that.
In the summer it was calculated they would not get back around 21 percent on those loans; now the discussions are about a loss – or haircut as they call it in the banking world — of 30 to 50 percent.
French banks have lent the most money to Athens at 42 billion euros. German lenders are in the hole for 18 billion and Britain’s banks are third in the losers’ league table with 10 billion euros of outstanding loans.
Then there are the Greek banks themselves; the country’s biggest lender alone — National Bank of Greece — holds 14 billion euros worth of government bonds.
Greek banking sources have said they could endure a loss of up to 30 percent but could not stand significantly bigger haircuts.