Amid the conjecture over which European banks are most exposed to the debt of Greece and the rest of the so-called PIGS, several banks in France made disclosures on their holdings of Greek debt.Credit Suisse estimated on Thursday that European banks hold up to US$1.3 trillion of Greek, Portuguese and Spanish debt. BNP Paribas, Credit Agricole and Société Générale were forced to disclose their exposures to Greece and Spain. BNP Paribas holds €5 billion of Greek sovereign bonds, while the latter two also have significant holdings and interests in Greek banks. CDS spreads on the three banks moved to levels well above those seen at the height of GFC I, after the disclosures.The ECB is also massively at risk through its sizeable holdings of bonds issued by the weaker euro zone members, and this risk is increasing. The ECB declared, after the announcement of the Greek bailout, that it would continue to accept Greek bonds for repos even though they are now rated junk by S&P and this violates the ECB's own minimum rating requirements.The euro is looking very shaky too. Markets are now starting to price in the possibility that the euro will fail. The great experiment in monetary union will be over, proving what was always suspected, if not known, that monetary union is impossible without fiscal union and preferably, political union. While the collapse of the euro will be horrendously expensive for Europe and usher in an extended period of economic recession (if not depression) it will allow those countries that do not default the opportunity to depreciate their newly reinstated currencies to affect a slow economic recovery.Unfortunately, contagion risks are not limited to just the euro zone. Globally integrated financial markets result in global exposure. Other heavily indebted countries such as the United Kingdom and the United States will become increasingly vulnerable. And in their now weakened states they will be greatly constrained in their ability to provide further assistance to their banks, should their banks find themselves with massive losses on their euro zone exposures. On Thursday National Australia Bank disclosed that it holds some A$5.5 billion of Italian government bonds.