The banks have approximately $83.1bn exposure to Spain’s public and private sector, including its banking system, drawing a picture of potentially disastrous consequences for the UK banks,if these economices submerged, reports Telegraph.
According to a data released by the Bank of England, out of the total, the banks have $83.1bn tied up in Spain’s public and private sector, including its banking system, and a further $59.4bn contact to Italy.
UK banks are more vulenaberable to the sovereign debt of the woresening European economies against Germany and France.
As per the report, by the end of December, the UK banks’ exposure to Italy stood at $59.4bn, out of which $44bn was private sector debt and $8.4bn was sovereign debt.
In Spain, the exposure stood at $65.8bn of the total $83.1bn exposed in the private sector, versus $4.4bn in sovereign debt.
The UK government recently launched a bank funding scheme to protect British lenders from the impact of the eurozone crisis.
UK Chancellor George Osborne said, "The £140bn emergency stimulus package is intended to kick-start mortgage and small business lending and defend our economy from the crisis on our doorstep."
