German banks contribute €4.5 billion to Greece

German banks contribute €4.5 billion to Greece
Photo: DPA
German banks, insurance companies and investment funds are reportedly set to contribute €4.5 billion to the new Greek bailout plan agreed last week.

Saturday’s edition of Die Welt newspaper reported that this is the total volume of bonds that German investors own in Greece that will expire in 2020.

The 21-percent cut in the Greek debt, which was agreed at a crisis summit on Thursday, means that private investors will ultimately end up contributing around €945 million to the Greek bailout plan directly.

This would mean that the contribution of German private investors to the plan is slightly smaller than, for instance, that of the French banks.

Economist and currency adviser to the European Commission Stefan Collignon described Thursday’s rescue deal as “a good decision,” but said the contribution of the private sector to Greece’s debt cut amounted to a “compulsory purchase.”

Speaking on German state broadcaster Deutschlandradio , Collignon said, “At the end of the day, investors and savers are paying for this gentle debt cut.”

DAPD/The Local/bk

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