Banque de France chief points to de­fault risks

Kathimerini English - - Business & Finance -

PARIS (AFP) – France’s cen­tral bank chief warned yes­ter­day that the eu­ro­zone risks hav­ing to fi­nance all of Greece’s econ­omy if it forces a mod­i­fi­ca­tion of Athens’s debt and the coun­try is de­clared in de­fault. France has been a lead­ing backer of the Euro­pean Cen­tral Bank, which has op­posed calls by Ger­many for push­ing pri­vate in­vestors to ac­cept de­layed pay­ment on Greek gov­ern­ment bonds as part of a sec­ond bailout for the trou­bled eu­ro­zone mem­ber. “If a so­lu­tion can be found that avoids the risk of a de­fault, that would be ac­cept­able to us,” said Banque de France Gov­er­nor Chris­tian Noyer. “If one can’t be found and you touch the debt any­way and pro­voke a de­fault or a ‘credit event,’ then you bet­ter be pre­pared to fi­nance the en­tire Greek econ­omy,” he added. A credit event is con­sid­ered to be a mod­i­fi­ca­tion of ini­tial bor­row­ing con­di­tions and usu­ally trig­gers down­grades if not a de­fault rat­ing by credit agen­cies. said on its web­site yes­ter­day. That com­pares with a peak of 130.2 bil­lion eu­ros in July. Span­ish banks have been us­ing ECB funds as con­ta­gion from the sov­er­eign debt cri­sis pushes up bor­row­ing costs for the gov­ern­ment and com­pa­nies. Fran­cisco Gon­za­lez, chair­man of Banco Bil­bao Viz­caya Ar­gen­taria SA, Spain’s sec­ond-largest lender, said yes­ter­day Spain “con­tin­ues to be a cause for concern” for the bank’s cred­i­tors.

(Bloomberg) will be­gin build­ing the Ford B-Max model be­gin­ning next year in Craiova, Ro­ma­nia, Nen­zen said. The com­pany will also be­gin pro­duc­ing fuel-efficient 1-liter Eco­Boost en­gines in 2012 as the com­pany in­vests more than 675 mil­lion eu­ros in Ro­ma­nia. (Bloomberg) cling of nu­clear fuel, and new nu­clear fa­cil­i­ties in Bul­garia. Bul­garia has an es­tab­lished nu­clear pro­gram dat­ing back 35 years. Nu­clear en­ergy ac­counts for a third of the nation’s elec­tric­ity gen­er­a­tion. (AP) sta­bi­lize over the next six to 12 months, al­though the pace of re­cov­ery in the banks’ stand-alone credit strengths will vary widely across the re­gion,” the re­port said. The bank­ing in­dus­tries of Azer­bai­jan and Uzbek­istan were also up­graded to a “sta­ble” out­look, Moody’s said. “Over­all, for the stronger per­form­ing bank­ing sys­tems, we ex­pect that healthy credit growth and earn­ings gen­er­a­tion will be un­der­pinned by broad-based eco­nomic ex­pan­sion for some – Tur­key and Poland in par­tic­u­lar – and by an ex­port­driven re­cov­ery for oth­ers,” the re­port said. The re­main­ing bank­ing in­dus­tries in the re­gion “face sig­nif­i­cant chal­lenges that will con­strain the pace of their re­cov­ery,” it said.

(Bloomberg)

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