How big is your financial sector?

Cyprus crisis made people think whether it is safe for country to have enormous financial sector in comparison to relatively small GDP. There are a lot of countries with the economies built around the financial sectors, and whose wealth depends on its development.

Luxembourg is the country which has the biggest financial sector: its bank deposits are almost 6 times as large as GDP. However, only 5% of total bank assets of Luxembourg belong to local banks, other 95% - are assets of branches of international banks which are safe. On the contrary, in Cyprus, 81% of banks are local.

So, the scope of financial sector as itself is not the reason for worries, but the quality of financial sector is what really matters.

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