Bild Report that Deutsche Bank Expects Debt Cut for Greece

Debt CutDeutsche Bank considers the possibility of a haircut of Greece’s public debt by the end of the year ‘inevitable’, according to a report in German tabloid Bild.

The newspaper cites a classified Deutsche Bank internal circulation document which allegedly states that the Greek debt must be reduced by about 200 billion euros. This turns out to about 700 euros for each citizen in the Eurozone, states Bild.

The report further notes that by the end of 2015 Greece’s public debt will be 340 billion euros, 200 percent of GDP, far more than what European regulations allow. This, in turn, means that no economist truly believes Greece will be able to repay its debts.

The tabloid however adds that should a haircut of the Greek debt be deemed necessary, the decision to carry it out will be less of a financial one and more of a political one, and it will be made after negotiations between Athens and creditors.