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According to data by the Bank for International Settlements (ΒΙS), at the beginning of the crisis the involvement of foreign banks in Greek debt was limited to about 50 billion Euros. In particular, today European banks hold Greek bonds worth 40 billion Euros. The exposure of German banks from nearly 30 billion Euros at the beginning of the crisis is now limited to 8 billion Euros, while the French (which had the greatest exposure in Greek debt) from nearly 45 billion Euros, limited to 12 billion Euros. 

According to an estimated of the Swiss UΒS, the largest holders of Greek debt today are foreign insurance and investment funds with 110 billion Euros, Greek and Cypriot banks with 72 billion Euros and the European Central Bank with 65 billion Euros. 

Based on data from the European Central Bank and the European Commission at the end of 2011 the public debt of Greece is estimated at 345 billion Euros. 

Of these 58 billion Euros affect the participation of Greek commercial banks, 45 billion Euros of foreign banks, 15.2 billion Euros contribution to the National Bank of Greece, 11 billion Euros participation of local insurance funds and local investors, 95 billion Euros participation of foreign insurance and investment funds, 42 billion Euros are Greek bonds purchased by the European Central Bank, while paying the installments on the loan of 110 billion Euros will amount to 78 billion Euros. 

If we follow these calculations, then a “cut” of 50 percent of Greek bonds would mean a total loss of 160 billion Euros, which will make Greek banks and local insurance funds most vulnerable. Swiss UΒS estimates for example that a “cut” of 50 percent of Greek bonds would reduce the equity capital of Greek banks by nearly 74 percent.

Serious losses would undertake also the European Central Bank as it received assurances amounted to 144 billion Euros and has disbursed loan amounting to 91 billion Euros to Greek banks. 

According to the most likely scenario, an extension of the deadline for payment of the Greek debt would mean that Greek banks will lose only 600 million Euros annually from the reduction of the interest. 

Discussed is the likelihood that the new interest in the period following the extension of the old debt will be about 3.5 percent. However, banks lose by freezing the liquidity for these bonds for a longer period of time. 

Rather it is a very small and easily recoverable losses for banks, which will have significant impact on the capital structure. 

The procedure for the extension of debt repayment will not include long-term bonds, for example, 30 years, but only short and medium term - with a maturity of 2 to 6-7 years. 

If the extension is done by increasing the coupons, then the banks will actually keep bonds for longer, but will increase the interest they will receive. If the extension is not accompanied by an increase of coupons, difficulties for banks will come from the freezing of capital, in order to be able to finance their wallets with bonds. 

Naturally, these are just some of the scenarios, since there may be a combination of extension for debt repayment and “cutting”, there may be extended in two stages, for example, initially 10 and later 20 years. Crucial to all this is how the market will perceive it, and also - as already mentioned - the time of realization.