Market information Friday July 3 2015

Greece needs almost EUR 70 billion external financing until the end of 2018, according to the International Monetary Fund (IMF). At least EUR 52 billion would have to come from the euro countries. Under a favorable growth scenario, the debt levels would still remain too high in relation to GDP. The Dutch government would need to pay EUR 5 billion to Greece, according to the IMF.

If Greece leaves the euro, it would lead to a decrease of 20% of Greek GDP over 4 years. Greek banks will not survive without the support of the European Central Bank (ECB). In addition, the new Greek currency will rapidly lose value against the euro. Because of the decrease of the currency, public and private debt denominated in foreign currency, would increase in value substantially. According to rating agency Standard & Poor’s (S&P) in a report published last Thursday.

U.S. regulators have told the Royal Bank of Scotland (RBS) it could pay as much as USD 13 billion if it loses a lawsuit over its handling of mortgage securities. The U.S. Federal Housing Finance Agency, suing on behalf of government-owned lenders Fannie Mae and Freddie Mac. RBS is seeking to have the case dismissed.

The 6M Euribor remained unchanged at 0.05%. The 10Y Swap remained unchanged at 1.23%.

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