PM holds Greek debt emergency talks

David Cameron met senior officials from Whitehall and the Bank of England to discuss the potential for Greek default on debts or exit from the eurozone.

The hour-long Cobra meeting in the Cabinet room at No 10 came amid continuing speculation about how the UK could suffer European shockwaves.

Downing Street stressed that the overwhelming majority of Greek debt is held by eurozone institutions, not by Britain, and that reforms since the previous crisis in 2012 may have lessened the vulnerability of other European countries to a shock from Greece.

But Mr Cameron’s official spokesman said: “There do remain risks around contagion and uncertainty and so it is important to look at all of those.”

The PM’s spokesman said they discussed “the risks of pressures in financial markets as potential uncertainty grows” and agreed it was important for the UK to be “vigilant” to the possibility of knock-on problems caused by the instability in Greece.

His spokesman added that it was “important to be vigilant to the risks of contagion”, but stressed important differences with the 2012 crisis, including the fact that bond yields on the debts of countries such as Portugal, Ireland and Spain are not so high.

“Things have changed since 2012 and there are some obvious differences, “ said the spokesman.

The meeting came after Chancellor George Osborne, who is set to attend EU crisis talks in Turkey, said Britain was “stepping up” planning to deal with any escalation of the crisis.