Mark Whitehouse, Columnist

Europe Is Too Exposed to Italy to Let It Go

French and German banks have more than $400 billion at stake and would lose big if the country left the currency union.

October 29, 2018 at 6:00 AM UTC

Mark Whitehouse is a member of the editorial board covering global economics and finance. Previously, he reported on economics for the Wall Street Journal and was managing editor of Vedomosti, a Russian-language business daily.

Exposed.
Photographer: Claude Paris/AFP/Getty Images

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Europe’s leaders are engaged in a high-stakes standoff with Italy, trying to coerce the populist government to drop its budget-busting spending plan. But how far can they go? Can they risk pushing Italy out of the currency union?

Judging from the exposures of French and German banks, they have a strong incentive to seek a compromise.