Disorderly Greek default may spark loss of trust: StanChart

Germany and France have accorded that private creditors should take part in a new rescue operation for Greece by voluntarily agreeing to roll over their holdings of Greek government bonds. In an interview with CNBC-TV 18, Sarah Hewin, head research-Europe at Standard Chartered Bank, said that European banks hold probably 80% of foreign banking exposure to Greece, and France and Germany have major holdings amongst those banks, which makes 1% of total banking sector exposure. She further stated that disorderly default may trigger loss of confidence in markets and potential liquidity freeze.

Below is the verbatim transcript of her interview with CNBC-TV18's Menaka Doshi. Also watch the accompanying video. Q: How voluntary can voluntary private lender participation be and what is the exposure of the private sector to Greek debt. We have got all kinds of numbers floating around?
A: The question is how voluntary a voluntary rollover can be is an interesting one. I think that there is a certain amount of behind the scenes coercion which is going on for large banks, particularly state owned banks in Europe to rollover debt as it falls due. The main thing is that there should not be seen to be any coercion because if that