Here’s an interesting question —
But executives warned that the trouble in Athens was only one part of a malaise that was forcing them to cut back their balance sheets. “We have reduced the balance sheet of RBS by over £700bn of assets”, says Stephen Hester, chief executive of RBS. “That is roughly twice the size of the entire national debt of Greece”.
I won’t begin to pretend that I know what is going on here, so can only express a rank outsider’s perspective, hazarding the comment that, if a bank can write down £700 [b]illion – and the world does not stop spinning – what is the big deal about Greece doing the same with a much smaller sum?
I think that’s an excellent question. I suspect the answer is the domino effect on sovereign bonds.