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This league table of Greek debt explains why Merkel will show Greece no mercy

Jul 9, 2015, 21:28 IST

REUTERS/Thomas Peter
REUTERS/Thomas PeterMerkel: No pay, no play.

It's no secret that the biggest holder of Greek debt - which Greece is currently refusing to pay - is Germany. But it is not until you see this ranking of Greek debt exposure from Deutsche Bank that you realize just how motivated German chancellor Angela Merkel is to prevent the Greeks from defaulting and keep them in the eurozone. She really, really needs to Germany's money back.

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The Greeks owe Germany €87 billion (£62 billion / $96 million). That's 20 billion more than the next biggest creditor, France. Italy and Spain are heavily exposed too but once you go further down the list the amounts become quickly smaller and more reasonable. It's all relative to size, of course. 400 million euros is doubtless a big deal in Cyprus.

But still, it's no wonder that Merkel, the IMF and the EU simply shrugged when the Greeks voted "No" to the bailout deal. She has 87 billion reasons to ignore their wishes.

Here's the table:

Deutsche Bank

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Missing from the list are the obvious non-euro using EU countries like Britain, Denmark and Sweden. Suddenly, being a member of the EU but keeping your domestic currency looks like the most important economic decision these countries ever made.

Now, before you become angry in solidarity with the Germans, there's the twist at the end of the Deutsche Bank note. Even if Greece defaults and exits the eurozone, it won't hurt these countries much. DB's Abhishek Singhania and Jack Di Lizia write the debt has already been accounted for and non-payment will therefore not be "financially burdensome":

The assessment of major rating agencies is consistent with our analysis that although the economic loss due to a Greek sovereign default or an exit from the Eurozone could be large it is unlikely to prove to be financially burdensome because it is not likely to raise immediate funding needs in creditor countries and has already been largely accounted for in the debt statistics of these countries.

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