Investors take up Greece's bond-swap offer, helping Athens avoid default
LA Times
March 9, 2012 | 12:07 am
REPORTING FROM ATHENS -- Big banks and private investors holding $227 billion in Greek bonds have agreed to join in an unprecedented debt-restructuring deal that clears a key hurdle in the release of international rescue funds to Greece, diminishing fears of a devastating default.
The Greek finance ministry said Friday morning that 85.8% of private-sector investors had committed to swapping their bonds for new ones with less than half their value as part of a complex scheme to wipe away about a third of Greece’s nearly $500 billion in debt.
It’s the biggest debt-restructuring exercise ever attempted, overshadowing Argentina’s $82-billion default a decade ago.
The plan, cobbled together by Athens, European officials and a bank lobbying group, is a key precondition for the release of a second, $170-billion bailout for Greece from its European partners and the International Monetary Fund. The bailout is designed to keep Athens solvent and, most pressingly, allow it to pay out $17 billion in bond redemptions due March 20.
(More here.)
March 9, 2012 | 12:07 am
REPORTING FROM ATHENS -- Big banks and private investors holding $227 billion in Greek bonds have agreed to join in an unprecedented debt-restructuring deal that clears a key hurdle in the release of international rescue funds to Greece, diminishing fears of a devastating default.
The Greek finance ministry said Friday morning that 85.8% of private-sector investors had committed to swapping their bonds for new ones with less than half their value as part of a complex scheme to wipe away about a third of Greece’s nearly $500 billion in debt.
It’s the biggest debt-restructuring exercise ever attempted, overshadowing Argentina’s $82-billion default a decade ago.
The plan, cobbled together by Athens, European officials and a bank lobbying group, is a key precondition for the release of a second, $170-billion bailout for Greece from its European partners and the International Monetary Fund. The bailout is designed to keep Athens solvent and, most pressingly, allow it to pay out $17 billion in bond redemptions due March 20.
(More here.)
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1 Comments:
An orderly bond-swap is better than the alternative although I would suggest a different headline, "Government Debt Leads to Citizen Losses.”
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