24-07-15

ECB's Noyer sees contagion risk from Greece for foreign banks "next to zero"

cep President Lueder Gerken notes that a third bailout of Greece would only be legal if it was really indispensable for assuring financial stability of the eurozone as a whole

Legality of bailout for Greece in question

ECB Governing Council member Christian Noyer said in an interview with Le Monde newspaper published on Friday that Greece represented "next to zero" risk of contagion for foreign banks as they had largely reduced their exposure to the massively indebted country. cep President Lueder Gerken already said at the start of the month that “it is doubtful whether a ‘Grexit’ would put financial stability at risk.” However, a third bailout of Greece would only be legal under the treaty of Europe’s ESM bailout fund if such financial aid was really indispensable for protecting financial stability in the eurozone as a whole, he argued.