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Lose-Lose: Greece Leaving Euro Seen Costlier Than Write-Off

A pensioner passes a main branch of the National Bank of Greece in Thessaloniki. — A pensioner passes a main branch of the National Bank of Greece in Thessaloniki.
Photographer: Konstantinos Tsakalidis/Bloomberg

Anooja Debnath

July 16, 2015, 9:43 AM UTCUpdated onJuly 16, 2015, 2:01 PM UTC

The hardliners who reject a Greek debt writedown to keep it in the euro are willing to pay much more to drive it out.

A “Grexit” would cost creditors almost 100 billion euros ($110 billion) more than keeping Greece in the currency union, reckons Alberto Gallo, head of macro credit research at Royal Bank of Scotland Group Plc. Zsolt Darvas at the Bruegel institute estimates that about 75 percent of the debt would not be paid to creditors following the return of the drachma.