Jeremy Hobson: European Finance ministers are gathering this morning in Brussels ahead of a key summit that was supposed to end with a grand solution to the European debt crisis. But divisions between the key players -- Germany and France -- mean that plan won't come this weekend. It's now scheduled to be unveiled at another summit next week.
For more on this, let's bring in Nick Davey, a banking analyst with UBS. He is with us from London. Good morning.
Nick Davey: Good morning.
Hobson: Well, what's the reaction there in Europe to the fact that these leaders have pushed back the deadline to release this "grand plan" to deal with the debt crisis?
Davey: I would say there's extreme uncertainty in the marketplace at the moment. Don't forget that it was only about two weeks ago that we were promised a bazooka solution this weekend that would incorporate all of the things the market is currently uncertain about -- namely, the level of contribution from the private sector and the restructing in Greece; secondly, to what extent the European banking universe needed to be recapitalized; and thirdly, to what extent the European bailout fund should or could be increased.
Now, we are -- I would say -- two days before the supposed revelation of this "grand plan," and we're no closer to, really, to understanding the details behind it.
Hobson: And I imagine all this uncertainty is particularly worrying for some of these countries that are sort of on the edge like Italy, Spain, Portugal -- places like that.
Davey: You're right. That being said, I mean there are some glimmers of hope out there. Specifcally here at UBS, we like and put forward the Nordic banks --
Hobson: Nordic -- Norway, you're talking about?
Davey: Exactly. The Norwegian banks, specifically I think, are an exreme safe haven. There are extreme levels of wealth, low soverign debt to GDP -- exactly the kind of metrics that the eurozone is lacking.
Hobson: And of course, Norway is not part of the euro.
Davey: Exactly. They're not part of the euro, crucially. And secondly, it has a backing system which hasn't bought into the eurozone.
Hobson: I'm curious -- are there any places within the euro that people think are safe?
Davey: Very little at the moment. I mean, contagion risk is really seen as a problem. The eurozone interconnectedness, I think, spooks the markets -- certainly during a period of political indecision. So at the moment, core eurozone I think remains an extremely difficult place to be. We here at UBS prefer areas outside of the eurozone -- the U.K. to an extent, but certainly Norway and Sweden as well.
Hobson: Nick Davey, banking analyst at UBS joining us from London. Thanks, Nick.
Davey: Thank you.