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Greek Ties to Bulgarian Banks Spur a Bond Rout as Contagion Spreads

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Bulgarian bonds slid the most in eastern Europe and Romania’s Eurobonds fell on concern the nations’ banking industries would be rocked by the contagion of a Greek exit from the euro region.

The two Balkan countries and Serbia have the most to lose in developing Europe as Greece’s four largest lenders hold 28 percent of total banking assets in Bulgaria and at least 12 percent in the other two, according to data from their respective central banks. The scale of the exposure led Royal Bank of Scotland Plc to cut Romania and Bulgaria to the equivalent of sell on Monday.