If you own European sovereign debt, the ESFS/ESM will supersede you in the capital structure. The mechanism will be second in line only to the IMF…
This little tidbit was at the end of S&P’s release:
We have previously stated that these possible credit implications
will not affect all EMU sovereigns equally, but only those we consider
to be potential borrowing clients of the ESM. We continue to believe
that Portugal (A-/Watch Neg/A-2) and Greece (BB+/Watch Neg/B), given
their high external financing need in the next few years, will be the
most likely candidates to approach the ESM for funding.
