European banks’ sovereign debt exposure

With fears of a European debt crisis back in focus amid deepening concerns over Ireland, the Financial Times has created an interactive graphic designed to explore European banks’ exposure to struggling economies.

Ninety-one large international and regional banks were asked to disclose their exposure to central and local government debt in 30 European countries as part of a high-profile “stress test” exercise carried out by the Committee of European Banking Supervisors (CEBS), the umbrella body for banking regulation across the European Union, in July.

At the time, investors were concerned that Greece’s spiralling sovereign debt crisis would spread contagion across the southern eurozone, exposing the fragility of Europe’s interdependent banking system, particularly in Spain, Italy and Portugal.

With Greece squarely at the centre of the crisis, less attention was paid to banks’ exposure to an Irish financial system that was struggling to contain the fallout from its own property bust.