The Greek Ministry of Finance released on Friday the highly anticipated offer document, firing the start on a colossal effort to find Greek bondholders and persuade them to participate in a €206bn debt swap. Athens needs bondholders to agree to the deal within days as part of its effort to unlock the €130bn bail-out funds needed to avert default on March 20. Wolfgang Schaeuble warned that the bailout, which was agreed late on Monday night, might not work. In a letter to German politicians, the finance minister said: “It may also not be the last time the German Bundestag will have consider financial aid to Greece. However, the chances of success with alternatives appear to me to be significantly lower at the current time.” Before heading to the G20 finance ministers’ meeting in Mexico this weekend, Mr Schaeuble suggested he was prepared to consider combining the eurozone’s two bailout funds, the European Financial Stability Mechanism (EFSF) and the European Stability Mechanism (ESM), to protect Spain and Italy. Lucas Papademos, Greece’s technocrat interim prime minister, chaired a cabinet meeting on Friday afternoon that approved the deal after the Greek parliament voted it through on Thursday evening. “We are making a titanic effort to secure financial support for the country,” said Mr Papademos as he left the meeting. Bondholders will be asked to voluntarily take a 53.5pc hit on their bonds by swapping them for new instruments worth 46.5pc of their current value. Bondholders will receive two-year bonds issued by the EFSF and new Greek bonds that will mature over 20 years from 2023. The new bonds will pay a coupon of 2pc for three years and 3pc for another five, followed by 4.3pc for the final 20 years. Saturday 25 February: Group of 20 finance ministers, central-bank governors meet in Mexico Monday 27 February: Belgian bond auction, Italian T-bill auction. German lower house extraordinary session to vote on Greek bailout. Wednesday 29 February: Allotment of ECB three-month, three-year long-term refinancing operations. Finland due to vote on Greek bailout. Thursday 1 March: Euro-zone finance ministers meet. Euro-zone February manufacturing PMI data. Spanish and French bond auctions. Thursday 1 March 1 to Friday 2 March: E.U. leaders' summit. Wednesday 7 March: German bond auction. Thursday 8 March: ECB interest rate decision. Monday 12 March: Euro-zone finance ministers meet. Greece aims to complete PSI by this date. Tuesday 20 March 20: €14.4bn of Greek government bonds mature.
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Saturday, February 25, 2012
The Greek Ministry of Finance released on Friday the highly anticipated offer document, firing the start on a colossal effort to find Greek bondholders and persuade them to participate in a €206bn debt swap. Athens needs bondholders to agree to the deal within days as part of its effort to unlock the €130bn bail-out funds needed to avert default on March 20. Wolfgang Schaeuble warned that the bailout, which was agreed late on Monday night, might not work. In a letter to German politicians, the finance minister said: “It may also not be the last time the German Bundestag will have consider financial aid to Greece. However, the chances of success with alternatives appear to me to be significantly lower at the current time.” Before heading to the G20 finance ministers’ meeting in Mexico this weekend, Mr Schaeuble suggested he was prepared to consider combining the eurozone’s two bailout funds, the European Financial Stability Mechanism (EFSF) and the European Stability Mechanism (ESM), to protect Spain and Italy. Lucas Papademos, Greece’s technocrat interim prime minister, chaired a cabinet meeting on Friday afternoon that approved the deal after the Greek parliament voted it through on Thursday evening. “We are making a titanic effort to secure financial support for the country,” said Mr Papademos as he left the meeting. Bondholders will be asked to voluntarily take a 53.5pc hit on their bonds by swapping them for new instruments worth 46.5pc of their current value. Bondholders will receive two-year bonds issued by the EFSF and new Greek bonds that will mature over 20 years from 2023. The new bonds will pay a coupon of 2pc for three years and 3pc for another five, followed by 4.3pc for the final 20 years. Saturday 25 February: Group of 20 finance ministers, central-bank governors meet in Mexico Monday 27 February: Belgian bond auction, Italian T-bill auction. German lower house extraordinary session to vote on Greek bailout. Wednesday 29 February: Allotment of ECB three-month, three-year long-term refinancing operations. Finland due to vote on Greek bailout. Thursday 1 March: Euro-zone finance ministers meet. Euro-zone February manufacturing PMI data. Spanish and French bond auctions. Thursday 1 March 1 to Friday 2 March: E.U. leaders' summit. Wednesday 7 March: German bond auction. Thursday 8 March: ECB interest rate decision. Monday 12 March: Euro-zone finance ministers meet. Greece aims to complete PSI by this date. Tuesday 20 March 20: €14.4bn of Greek government bonds mature.
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4 comments:
The premier also reminded the Cabinet that a series of ministerial decisions
and circulars related to so-called “prior actions” demanded by creditors must be
issued by next Wednesday, ahead of an EU summit. The summit is to be prefaced on
Thursday morning by a brief meeting of eurozone finance ministers who will
consider Greece’s situation."
Er, weren't the Greeks supposed to pass 39 measures prior to receiving the second bailout till the end Of February, next Wednesday?
Is it possible to pass 39 measures in 39 days that they haven't started even discussing yet?
I am saying again-I am very confused.
They must be relying on money coming through implementation or not.
You have a value say 1 billion just for arguments sake. Now you can exchange these for some other bonds with a write down of 31% or so. That if you were an investor you would want more bonds is another thing. If the 1 billion is not there then you are playing with 31% of nothing, not a bad deal if the new bond ends up being worth something.
The fishy bit is this billion worth nothing if not there and investors in the USA get cash out of the deal of something worth nothing?
The thing about any ponzi type scheme is not really the scheme it is actually finding a way to get the money out is the trick before it collapses.
This subliminal move, a deception enables a few to get the cash out before it collapses. Now on that point I do hope those lucky enough to manage to get the cash out demand the money is in a stable currency or alternatively ask for it in gold.
The debt swap will be run from London by Deutsche Bank and HSBC.
Nice to know we will make a bit of profit from this crisis (assuming that the fees are payable in advance). There's one for europhile conspiracy theorists!
Why nowhere in you Debt Crisis Live Coverage is NOT even mentioned the most important part of the debt swap : the CAC/Colective Action Clause/ is being INCLUDED in the deal and IMPOSED on the private investors ?
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