Posts Tagged ‘Cuprus debt to GDP. Cypriot bank bailout’

While small, the Cypriot bank bailout is causing heartburn across the Eurozone. At its peak, the banking sector had assets eight times GDP and now needs $13 billion. If Cyprus borrows the money, their debt-to-GDP ratio becomes unsustainable. Writing down sovereign debt won’t work because it’s held by the banks and forcing a haircut on…