Germany Is Expected To Support Its Banking Industry In The Case Of Greek Default.

According to foreign media reports, three officials of the German coalition government said Friday that the government under the leadership of Angela Merkel, the prime minister, is preparing a plan to provide support for the German banking industry when the Greek government is unable to meet the conditions of loan aid and default on its debts.

According to Bloomberg reports, the three anonymous government sources revealed that the emergency plan includes helping banks and insurance companies, if Greece.

The industry pointed out that the German government's "B plan" shows that the country is worried that the Greek authorities can not continue to implement its budget reduction plan, which will threaten the EU's efforts to curb the sovereign debt crisis.

German congressmen this week criticized the Greek authorities to threaten to detain aid loans unless the Greek government could meet the relevant provisions of its fiscal austerity plan.

Prior to that, a task team sent to Greece by the European Union, the European Central Bank and the International Monetary Fund (IMF) has suspended reports on the progress of the budget cuts in the country.

According to a report released yesterday by the German parliament, Wolfgang Schaeuble, the country's finance minister, told congressmen at a closed meeting held in September 7th that the current situation in Greece is "at stake". Wolfgang

He pointed out that if the Greek government could not meet the terms of the aid loan, it would have to be solved by Greece itself.

An anonymous spokesman of the German government said that the country was waiting for the progress report of Greece to implement the budget reduction plan before deciding what measures to take.

According to CMA, a London data provider, the price of credit default swap used to protect Greek sovereign bonds from default has risen by 212 basis points today, hitting a record high of 2328 basis points.

In the credit default swap, the price of the 1 base points is equivalent to $1000 per year, which can protect 10 million dollar bonds from default in five years.

Credit default swap (CDS) is a financial derivative product derived from credit card loan. It can be regarded as a kind of breach insurance for financial assets. Creditors can sell the debt risk through this contract, and the contract price is the premium.

The party who purchases the credit default insurance is called the buyer, and the party who takes the risk is called the seller.

The two sides agreed if