Cypriot banks’ high exposure to Greek sovereign bonds could force the island nation to seek European financial support if Greece defaults on its debt and possibly leaves the euro after parliamentary elections next week.
The Moody’s rating agency warned over the weekend that if Greece leaves the single-currency union and remaining nations in the euro fail to stem the resulting market anxiety, Cyprus will likely be shut out of international funding markets and downgraded. Read more “Cyprus on the Brink from Greek Eurozone Exit”