Britain's banks slashed $50 billion (£31.8 billion) from their exposure to France, Italy and Spain during the summer as financial institutions ran scared

<p> </p><p>Britain's banks slashed $50 billion (£31.8 billion) from their exposure to France, Italy and Spain during the summer as financial institutions ran scared from Europe's debt crisis, according to the Bank for International Settlements. The latest figures from the Basel-based BIS, "the central banker's bank", revealed that UK banks' total exposure to the three European strugglers had fallen to $430.4 billion at the end of September, against $479.9 billion at the end of June. UK banks' stocks of French, Spanish and Italian sovereign bonds were unceremoniously dumped as bond markets turned on vulnerable European nations. The BIS figures revealed UK bank holdings of French, Italian and Spanish sovereign debt dived 32% to $55.5 billion over the quarter, with holdings of Italian bonds suffering the biggest sell-off. Banks sought safety in German bunds, boosting their holdings by more than $40 billion during the period. The European Central Bank's December move to pump nearly €500 billion (£420 billion) into ailing financial institutions for three years eased the immediate threat of a damaging credit crunch. However, France was stripped of its triple-A credit rating this month, Italy's debt-laden economy is heading into recession and Spanish unemployment broke through five million.</p>

Britain's banks slashed $50 billion (£31.8 billion) from their exposure to France, Italy and Spain during the summer as financial institutions ran scared

  Britain's banks slashed $50 billion (£31.8 billion) from their exposure to France, Italy and Spain during the summer as financial inst...

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