Rehn Says Europe Debt Restructuring Would Cause ‘Chain Reaction’

European Union Economic and Monetary Affairs Commissioner Olli Rehn said a debt restructuring in the euro area would cause a “chain reaction” in the banking industry and he ruled out such an operation for Greece.

“We see that in a still-fragile situation in the European economy there is a risk that debt restructuring would cause a chain reaction through the banking sector,” Rehn said today at an event in Washington. “That would have a serious negative impact” on lending and negative ramifications for households and citizens and could endanger the recovery, he said.