In Ireland, Portugal and Spain, the financial debt of households and firms amounted to between one and a half and two times the euro-area average of 170 per cent of GDP (in Italy it was equal to 130 per cent).
In Ireland, the largest national banks had balance-sheet assets totalling more than five times GDP; the collapse of property prices and the recession caused them huge losses. Imbalances of this kind ultimately have repercussions on the public finances, even in countries where these are initially in order.