Involvement in The European Sovereign Debt Crisis
In June 2012, it was estimated that the Bundesbank had Euro 644 billion exposure to other central banks in the eurozone under the TARGET2 payment system. Only three other eurozone central banks had net exposure from the system; all others had the offsetting net exposure due to the system. The net exposure finances trade imbalances and capital flight. The Bundesbank is the largest shareholder of the European Central Bank. The ECB has bought up more than €200 billion in sovereign debt from crisis-ridden countries. Some of this would have to be written off in the case of a euro collapse, which would entail corresponding losses for the Bundesbank.
Read more about this topic: Deutsche Bundesbank
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