Pri­vate cred­i­tors to shoul­der part of bur­den

Kathimerini English - - BUSINESS & FINANCE -

Ger­many has the “clear ex­pec­ta­tion” that pri­vate cred­i­tors will join in any fur­ther fi­nan­cial sup­port granted to Greece, Fi­nance Min­is­ter Wolf­gang Schaeu­ble’s chief spokesman said yes­ter­day.

Euro-area gov­ern­ments were ex­pected to dis­cuss a re­port on Greece’s progress in ad­her­ing to the terms of its in­ter­na­tional bailout at a meet­ing in Vi­enna late yes­ter­day, ac­cord­ing to min­istry spokesman Martin Kot­thaus. They may also talk about cred­i­tor in­volve­ment in Greece in the event that any ad­di­tional help is needed, he added.

“If the pub­lic sec­tor, in­clud­ing tax­pay­ers, were to agree to give the Greeks more breath­ing room, then I think it’s ob­vi­ous to have pri­vate cred­i­tors join such a pro­ject,” Kot­thaus said.

“I can’t tell you how that looks in de­tail be­cause we’re wait­ing for the ques­tions and an­swers” from the Greece in­spec­tors’ re­port.

With in­vestor ex­pec­ta­tions ris­ing that Greece will be pro­vided with ad­di­tional money by the Euro­pean Union and In­ter­na­tional Mon­e­tary Fund, Greek bonds gained for a third day yes­ter­day, mov­ing to the low­est point in more than two weeks.

Yields on the notes due 2013 sank 44 ba­sis points to 24.57 per­cent early in the day, the least since May 17.

Ear­lier, Ger­man gov­ern­ment ad­viser Peter Bofin­ger floated the idea of help­ing Athens by via a Brady bond-style res­cue op­er­a­tion in which Greek gov­ern­ment bonds are swapped against debt is­sued jointly by euro-re­gion mem­bers. Joint euro-re­gion bonds would be help­ful for Greece be­cause they would carry a very low in­ter­est rate and they would be good for banks be­cause len­ders would re­ceive AAA-rated bonds in ex­change for lower-rated pa­per, he told Bloomberg.

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