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Nations Most Exposed to the PIIGS

The European sovereign debt crisis continues to rattle global markets as uncertainty over austerity measures and a proposed bailout have people questioning whether the Eurozone will be able to survive more financial trauma.

At the center of concerns are the "PIIGS" nations - Portugal, Italy, Ireland, Greece and Spain - heavily indebted countries in danger of default that could trigger an economic domino effect around the globe.

In a June 2011 report, the Swiss-based Bank for International Settlements (BIS), a clearinghouse for world’s central banks - reviewed central bank data and reveals the countries that are the most exposed to European turmoil, specifically in their banking systems.

The numbers presented here take into account foreign claims - investments in the form of loans and bonds that have arisen from PIIGS nations – that are held by international banks headquartered outside the individual countries. If a government defaults on debt, it could carry catastrophic consequences for the country's economy, with the potential to seriously devalue - or potentially wipe out - these assets.

For the context of this report, CNBC.com compared the dollar-value exposure of countries to the total value of assets held by the country's banks for an approximate percentage of total direct exposure. The exposure numbers only include data from international banks, and do not account for insurance companies or other financial firms.

So, which countries are most exposed to the PIIGS? Click ahead for a country-by-country breakdown.

By Paul Toscano
Updated 21 June 2011

Notes: Countries are listed in order of exposure, but are not presented in rank order as the BIS does not provide a completely comprehensive list of countries. The numbers also do not include any insurance taken out against these market bets.

Assets in BIS data include only those held by international commercial banks headquartered in various countries. When banking sector information is taken from the EU, it includes domestic banking groups and stand-alone banks, all institutions, total assets [full sample], outstanding amounts at the end of the period (stocks), all currencies combined.

Photo: Milos Bicanski| AFP | Getty Images